2:30PM NY, U.S. Market Movers

A.C. Moore Arts & Crafts Inc. (ACMR: chart) shares soared 11.7% after the craft store operator reported a higher first-quarter profit on improvements in both sales and margins, against Wall Street''s expectation for a loss. Net income more than doubled to $572,000, or 3 cents per share, from $250,000, or a penny per share, in the prior-year period. Sales increased 2% to $135.4 million compared with $132.9 million a year ago.

AQuantive Inc. (AQNT: chart), online advertising company, first quarter profit climbed 87%, on big sales boosts in its digital marketing service and digital performance media divisions. For the quarter net income rose to $14.2 million, or 16 cents per share, from $7.6 million, or 10 cents per share in the prior year quarter. Revenue rose 55% to $142.6 million, versus $92.2 million in the first quarter of 2006. Shares jumped 11.9%.

Florida East Coast Industries (FLA: chart) said it would be acquired by fund manager Fortress Investment Group LLC ((FIG.N)) in deal valued at $3.5 billion. Shares climbed 13.3%.

Sonus Networks Inc. (SONS: chart), which makes Internet telephony equipment and software, said first-quarter sales rose 18% fueled by growth of the Internet protocol-services market. First-quarter sales rose to $71 million from $60 million a year ago. Shares climbed 6%.

Warnaco Group Inc. (WRNC: chart) said that its first-quarter earnings more than doubled on sales growth in the apparel maker''s sportswear group, which benefited from the acquisition of Calvin Klein''s international business. First-quarter net income jumped to $38 million, or 82 cents per share, from $13.9 million, or 30 cents per share, a year ago. Revenue increased 21% to $547.2 million from $453.2 million in the prior year. Shares jumped 16.4%.

Cutera (CUTR: chart), maker of laser skin treatment systems used by dermatologists and plastic surgeons, said that first-quarter earnings grew 59%. Net income increased to $1.8 million, or 12 cents per share, compared to $1.1 million, or 8 cents per share, in the year-ago period. First-quarter revenue grew 12%, to $23.3 million from $20.8 million a year ago. Shares fell 21.3%.

DJO Inc. (DJO: chart), medical device maker, said that its first-quarter net earnings declined $4 million, or 17 cents per share, compared with $5.98 million, or 26 cents per share, in the year-ago period. Excluding certain items, earnings came in at 23 cents per share versus 28 cents per share last year. Revenue climbed to $114.9 million against $82.6 million in the same period a year earlier. Shares fell 18.1%.

MicroStrategy Inc. (MSTR: chart) first-quarter profit plunged 35% from the year ago period, as expenses swelled and license revenue declined. Net income for the quarter was $9.8 million, or 75 cents per share, down from $15 million, or $1.05 per share, for the first quarter 2006. Revenue for the period was $72.4 million, up 4% from $69.5 million in the year ago period. Shares fell 12.6%.

W&T Offshore (WTI: chart), oil and gas explorer, first-quarter profit fell 77%, hurt by weaker product prices and higher lease operating costs. Quarterly earnings dropped to $13 million, or 17 cents per share, from $55.8 million, or 85 cents per share, in the prior-year period. Revenue rose to $246.5 million versus $156.9 million a year ago, compared with analysts'' expectations of $247.3 million. Shares plunged 10.8%.

1:00PM NY, 5:00 PM Frankfurt European stocks lost ground ahead of rate decisions.
European stock markets lost ground on Tuesday, dragged down by cyclical stocks ahead of central bank decisions around the globe. Losses on Wall Street after several winning sessions and before Fed Reserve’s meeting also contributed to the negative sentiment. Among the leading decliners, truck maker Volvo lost 6.4%, while easyJet dropped 7.1% after reporting that load factor fell to 83.1% in April from 86.4%. Dutch telecom KPN fell 3.3% after its Q1 net income dropped 18%.

On the side of the gainers, German sportswear maker Adidas surged 7.3% after the group said that the order backlog for both of its main brands rose in Q1. In merger-and-acquisition news, Reuters Group rose 2.3% after stating that Thomson Corp. will offer $17.4 billion to take over the news service. Shares in steelmaking giant Arcelor Mittal dropped 2.6% amid reports that it is considering a $4.5 billion bid for steel-tube maker AK Steel.

The German DAX Xetra 30 slipped 1.1% at 7,442.20, dragged by 12.5% decline in the shares of Altana. The U.K. FTSE 100 lost 0.8% to trade at 6,550.40 and the French CAC-40 fell 0.6% at 6,034.25.


11:30AM U.S. stock averages traded down on rate worries and economic data.
U.S. stocks continued to post losses as investors turned to consolidation of recent gains, awaiting the Fed Reserve''s decision on interest rates. Economic data released today added further pressure to stocks, as the Commerce Department said wholesalers'' inventories grew at a slower rate in March, coming in below expectations.

Dow member Hewlett-Packard (HPQ: chart) bucked the downward trend. Company’s shares rose 2% after raising its Q2 financial outlook, citing strong operational results from its personal systems group and servers businesses. The Dow component said it now sees earnings of 64 to 65 cents a share on revenue of $25.5 billion to $25.55 billion. However, most of the blue-chip stocks declined. General Motors (GM: chart) fell 1.4%, Coca Cola (KO: chart) slipped 1.2%, and AT&T (T: chart) lost 1.2%.

Among the most notable gainers, Blue Nile (NILE: chart) surged 16% after the online jewelry retailer reported Q1 net earnings of 19 cents a share, up from 13 cents a share a year ago, helped by 34% revenue increase to $67.9 million. Quarterly results beat estimates of per-share profit of 15 cents on revenue of $61.7 million. In other earnings news, Revlon (REV: chart) rose 1.5% after it said its Q1 loss narrowed amid cost-cutting. The company reported a loss of $35.2 million, or 7 cents per share, compared to a loss of $58.2 million, or 15 cents last year.

Resource stocks showed significant weakness amid a decrease in commodities prices. Gold, oil service, and natural gas stocks posted notable losses, while computer hardware, computer technology and telecoms advanced. In late morning trading, the Dow Jones industrial average fell 57.94, or 0.44%, to 13,255.03. The Standard & Poor''s 500 index was down 6.70, or 0.44%, at 1,502.78, and the Nasdaq composite index shed 11.28, or 0.44%, to 2,559.67.

Wholesale trade rose 1.8% in March.
Tuesday morning, the Department of Commerce released its report on wholesale trade in the month of March. While the report showed a notable increase in wholesale sales, wholesale inventories rose slightly less than expected. The report showed that wholesale sales rose 1.8 percent in March following a 1.0 percent increase in February. With the increase, wholesale sales rose at an annual rate of 8.4 percent. The sales growth was partly due to a rebound in wholesale sales of durable goods, which rose 2.1 percent in March after falling 0.8 percent in the previous month. Wholesale sales of non-durable goods rose 1.5 percent after rising 2.8 percent in February.

The Commerce Department also said that wholesale inventories rose 0.3 percent in March following a revised 0.4 percent increase in February. Economists had expected inventories to rise 0.4 percent compared to the 0.5 percent increase originally reported for the previous month. Subsequently, the inventories/sales ratio edged down to 1.14 in March from 1.15 in February, although the ratio was unchanged from March of 2006.