U.S. MARKET AVERAGES

U.S. stock markets are trading lower in the first two hours, affected by disappointing unemployment data and renewed rise of oil prices.
The Labor Department reported that first-time filings for state unemployment benefits rose by 6,000 to a seasonally adjusted 316,000 last week, marking the highest level since the week ended July 9. The increase was larger than expected. Economists were expecting claims to rise to about 310,000 from the initial estimate last week of 308,000.

The index of leading indicators increased slightly in July as the Conference Board reported, following a sharp increase in June, which keeps it on a slightly rising trend. Over the last six months the index has advanced at 2.2% annual rate, but compared to a peak of 10% growth at the end of 2003, it is a down.

Investors' attention is focused on a few major companies such as:

Google which filed with the Securities and Exchange Commission to sell $14.2 million new Class A shares in an underwritten public offering. At current market prices this would raise over $4 billion. According to analysts the offering would roughly double Google’s earnings and revenue for 2005 in comparison with last year. Since the IPO in Aug last year, Google's stock has more than tripled. Company’s shares closed Wednesday at $285.10. In early trading today the shares fell $7.01 to $278.09.

Salesforce, software company, posted quadrupled 2Q profit of $5 million, or 4 cents a share vs. $1.1 million, or 1 cent a share last year, meeting analysts’ expectations. The favorable quarterly results are due to 77% rise in revenue to $71.9 million with subscribers increase by 41,000.

Medtronic, medical device maker, reported 1Q earnings of $615.9 million, or 50 cents a share on revenue of $2.69 billion. Analysts had expected profit of $598.9 million, or 49 cents a share on sales of $2.67 billion.

Hot Topic, retail chain, posted 2Q profit drop of $900,000, or 2 cents ashare compared with $4.5 million, or 9 cents a share a year ago, missing estimates of 3 cents a share. Same-store sales fell 3.5%. The company lowered its 3Q earnings forecast to the range of 15 to 18 cents a share.

Gap is expected to report 2Q profit of 21 cents a share.

JDS Uniphase, world’s largest maker of fiber-optic parts, was supposed to report 4Q earnings. Analysts expect a wider loss of 2 cent a share vs. 1 cent a year ago, but the company delayed the announcement of its 4Q results because it has to complete the year-end audit of its financial statements. The company expects to top analysts’ expectations on revenue growth by several millions.

Bebe Stores, retailer, is expected to post 4Q earnings of 19 cents a share.


INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks finished the session mostly in the red with Hong Kong’s Hang Seng leading the losers. The index tumbled over 300 points to close down 1.95% on energy stocks and profit-taking. The Japanese Nikkei enjoyed high levels in early trading, helped by banking, auto and steel sectors which were given a boost by the recovering U.S. equities and the climbing dollar vs. the yen. South Korea’s Kospi was another sharp decliner, down 1.85%. In Tokyo the dollar traded at 110.28 yen, up 0.13 yen.

European markets closed the trading session lower as losses in the energy sector outweighed gains in the U.S. equity markets and several broker upgrades. In the market’s focus was the Royal Bank of Scotland which said that is leading a consortium buying 10% stake in the Bank of China. Germany’s DAX 30 lost 0.41%, France’s CAC 40 declined 0.22%, and London’s FTSE fell 0.44%.


ENERGY, METALS AND CURRENCIES MARKETS

Oil steadied over $63 a barrel a day after it tumbled nearly $3 on higher inflation and lower demand in U.S. Light, sweet crude traded at $63.10 a barrel, down 15 cents. London Brent fell 12 cents to $62.44.

Gold declined in European trading on strengthening dollar. In London the precious metal closed at $441.30 per troy ounce, down from $441.80. In Hong Kong gold dropped $5.10 to close at $439.25. Silver closed at $6.98, up from $6.96.

Copper recovered slightly from its 3% drop in the previous session. September copper was up 0.9 cents to $1.666 a pound.