In Paris stocks gained, led by Renault, BNP Paribas SA and Air France-KLM Group. French second-biggest carmaker, car maker advanced 1.6% amid reports it is considering a partnership with GM’s Opel division which will result in cost. In the financial sector, BNP Paribas added 1%. Elsewhere, airline Air France advanced 0.8%, while Bouygues, the world''s second-largest builder, gained 0.5%.


12:00PM New York, 6:00PM London - Bank shares dropped sharply, as metal stocks helped UK rise mildly, as investor worries over US mortgage market losses calmed down. Rio Tinto-Alcan deal approved. India’s Tata may bid for stakes in Jaguar and Land Rover. New investor eyes Nasdaq’s 31% London Stock Exchange stake.

Mining shares helped carry the day in yesterday’s trading in London, as bank stocks dropped on speculation the European Central Bank may lift rates. London gained 0.37% at close paring earlier volatility. Of the 102 FTSE 100 shares, 65 gained, 36 declined while 1 remained unchanged.

In London trading FTSE 100 finished marginally higher 0.37% at 6,220.10 thanks to a late surge in metal stocks. Financial shares crumbled under Europe interest rates uncertainty. ECB president Jean Claude Trichet has remained unclear over rates direction going forward, preferring, instead, a cautious wait and see attitude. Speculation abound ECB may lift rates on Sept 6 to stem borrowing.

Press reports over the weekend indicated a new investor may be coming to purchase Nasdaq’s 31% stake in LSE. Several names including Singapore firm, Temasek and German exchange, Deutsche Bourse, have been linked with the deal. Nasdaq is selling the LSE stake to concentrate on other investments after failing to gain control of the London market. The stake is valued at nearly 800 million pounds.

Of the FTSE 100 stocks, mining and consumer shares rose. SAGE Group rose fastest up 3.21% followed by BG Group plc adding 2.74% and Wolselely plc rising 2.64%. Rio Tinto lifted higher 2.36% after the U.S. authorities consented to the $38.1 billion take-over bid of Alcan, a Canadian aluminum firm. Rio Tinto will pay $101 for every Alcan shares. Sainbury plc gained 2.16%. Metal shares Xstrata, BHP Billiton plc and Anglo American rose 1.79%, 1.48% and 1.2% respectively. Kingfisher and Marks & Spencer gained over 1.4% each.

Of the stocks in FTSE 100 index, financial stocks paced decliners on concern the European Central Bank may lift rates. Standard Chartered led the decliners with 4.90% followed by 3i Group plc falling 4.26%. British Energy lost 2.67%, Barclays plc fell 2.63% while Man Group plc shed 2.55%. Northern Rock eased 2.31% with HBOS plc and Old Mutual dropping 1.5% and 1.03% respectively. British Airways fell on similar concerns, that borrowing cost will increase at the time when airfares are likely to drop. The airliner lost 2.4%. It said earlier today its 3.4 billion euro joint bid for Spanish airline Iberia Lineas Aereas de Espana SA may be revised downwards.

Tata Group chairman, Ratan Tata announced today that it may be interested in British carmakers, Jaguar and Land Rover from parent firm, Ford. Ford is contemplating to sell 50% of the units. Tata Motors relies on the Indian market for more than 90% of its sales. Tata wants to increase its global market foot print.

11:30AM Market averages dropped further lower, pressured by economic growth concerns.

U.S. stock averages moved further to the downside amid concerns about the economic growth, sparked by signs of growing weakness in the housing sector. A notable decrease in crude oil prices also generated negative market sentiment, sending energy stocks down. Exxon (XOM: chart) declined 0.8%, while shares of oil giant Chevron (CVX: chart) dropped 0.6%.

Utilities stocks were also notable decliners after last-week strong performance. Shares of big manufacturers, banks and other financial services companies posted the heaviest losses. 3M Co (MMM: chart) declined 1.1%, General Electric Co (GE: chart) lost 0.9%, while shares of Boeing Co (BA: chart) fell 0.7%.

Among financials, shares of the biggest U.S. mortgage lender, Countrywide Financial Corp (CFC: chart), dropped 4.8% after Lehman Brothers downgraded its stock. JPMorgan (JPM: chart) dropped 1.3%, whereas Citigroup (C: chart) slipped 0.9%.

Housing stocks came under pressure, following the release of a report on existing home sales, which showed a modest decline in sales, 0.2%, and a significant increase in inventories of unsold homes. The National Association of Realtors said that inventories of unsold single-family homes climbed 2.2% to 3.85 million in July, sending the inventory in relation to sales to the highest level in 16 years.

Shares of home improvement retailer Home Depot (HD: chart) rose 1.8% on news that agreed to sell off its wholesale-supply unit for $8.5 B, which is $1.8 B less than previously planned.

Tech stocks were given a boost by deal news in the sector. Shares of personal-computer maker Gateway (GTW: chart) skyrocketed 48% after Taiwan''s Acer agreed to buy the company for 710 million, or $1.90 a share, a 57% premium to Friday''s closing price. On the side of the losers, Apple (APPL: chart) dropped 1.8% and EMC Corp. (EMC: chart) slipped 2.1%.

In late morning trading, the Dow fell 52.59, or 0.39%, to 13,326.28. The Standard & Poor''s 500 index fell 9.64, or 0.65%, to 1,948.69, and the Nasdaq composite index fell 15.06, or 0.58%, to 2,561.63. Bonds rose, with the yield on the benchmark 10-year Treasury note falling to 4.60% from 4.62% late Friday.

Existing-home sales fell 0.2% in July.

Monday morning, the National Association of Realtors released its report on existing home sales in the month of July, showing that existing home sales fell modestly compared to an upwardly revised reading for the previous month. The report showed that existing home sales edged down 0.2 percent to an annual rate of 5.75 million units in July from an upwardly revised pace of 5.76 million units in June. With the decrease, existing home sales were down 9.0 percent year-over-year. Economists had been expecting existing home sales to fall to a 5.70 million unit rate compared to the 5.75 million unit rate originally reported for the previous month.

The modest decrease in existing home sales was due in large part to a 2.2 percent drop in sales in the Midwest, which was partly offset by a 1.8 percent increase in sales in the West and a 1.0 percent increase in sales in the Northeast. The report also showed that the national median existing-home price for all housing types was $228,900 in July. The median price was down 0.6 percent from July of 2006, when the median was $230,200, the highest monthly price on record. NAR added that total housing inventory rose 5.1 percent to 4.59 million existing homes available for sale at the end of July. This represents a 9.6-month supply at the current sales pace, up from an upwardly revised 9.1-month supply in June.