1:00AM NY, 5:00 PM Frankfurt European stocks closed lower as weak mining stocks offset gains in the shares of Nokia.
European stock markets closed lower on Thursday, as weakness among mining companies and worries that China will hike interest rates because of stronger-than-expected growth and inflation, offset upbeat margin news from Nokia and hopes for pharmaceutical-sector earnings. Shares of Nokia rose 3.5% after the world''s largest maker of mobile phones posted market share gains and a better-than-expected gross margin. Nokia also said that its Q1 net profit slipped 7%, in line with analyst expectations. In the pharmaceutical sector, drugmakers AstraZeneca and GlaxoSmithKline rose more than 1%, following strong earnings from U.S. drug maker Merck. In addition, exporting automakers DaimlerChrysler and Porsche fell over 1.5% amid weakening dollar. The euro traded near record highs vs. the dollar, and the pound held over $2. The German DAX 30 fell 0.5% at 7,242.73, the French CAC-40 lost 0.1% at 5,829.04 and the U.K. FTSE 100 declined 0.1% at 6,440.60.


11:30AM U.S. market averages regained some ground.
U.S. stocks regained some ground after the initial drop but remained in the negative territory. The recovery attempt by the major averages was helped by strength among pharmaceutical and biotechnology stocks, with Schering-Plough (SGP) and Amgen (AMGN) rising 8% and 5%, respectively. Among biotech stocks, shares of Gilead Sciences (GILD) climbed 5%, Celgene (CELG) rose 4%, and MedImmune (MEDI) added 3%. Strength in the computer hardware sector also contributed to the upward move. Intel Corp. (INTC) gained 1.7%. On the other hand, the market sentiment was hurt by weakness among health insurance, tobacco, and gold stocks, helping to keep the major averages in the red. Energy and gold stocks also came under pressure amid a significant decrease by the price of oil and gold.

In economic news, the Conference Board said its index of leading economic indicators rose by 0.1% in March after falling the two previous months, coming in slightly below expectations of a rise of 0.2%. Six of the 10 leading indicators rose- jobless claims, factory hours, money supply, vendor performance, building permits and new orders for consumer goods. Four indicators fell- stock prices, consumer expectations, the interest rate spread, and capital equipment orders.

Among the companies releasing quarterly results, D.R. Horton (DHI) posted Q2 profit drop of 85% to 16 cents a share from $1.11 a share a year earlier, missing estimates of 27 cents. Home-building revenue dropped to $2.62 billion from $3.53 billion in the year-ago period. Shares of the home builder added 1%. In late morning trading, the Dow Jones industrial average fell 15.93, or 0.12%, to 12,787.91. The Standard & Poor''s 500 index fell 1.98, or 0.13%, to 1,470.52. The S&P hit a new 6 1/2-year high Wednesday. The Nasdaq composite index fell 3.89, or 0.15%, to 2,506.61. Bond prices showed little movement following the economic data and after prices rose for three straight sessions. The yield on the benchmark 10-year Treasury note was unchanged at 4.66% from late Wednesday.

Leading indicators index rebounded in March.
Thursday morning, the Conference Board released its report on leading economic indicators in the month of March. The report showed that the leading indicators index increased in line with what economists had been expecting. The Conference Board said that the leading index edged up 0.1 percent in March after a revised 0.6 percent decrease in February. Economists had expected the index to increase by 0.1 percent compared to the 0.5 percent decrease originally reported for the previous month. The modest increase by the index reflected large positive contributions from unemployment insurance claims, real money supply, and average workweek in manufacturing. However, the positive contributions were partly offset by decreases in stock prices, consumer expectations, and the interest rate spread. The report also showed that the coincident index edged up 0.1 percent due to a large positive contribution from non-agricultural employment. The Conference Board noted that the strengths of the coincident index have been more widespread than the weaknesses in recent months. The Conference Board added that the lagging index also rose 0.1 percent in March, with four of the seven components advancing.


9:45AM U.S. markets opened lower on Asian weakness and earnings reports.
Wall Street opened in the red, reflecting steep declines in Asian and European markets. Shanghai Composite tumbled 4.5% amid higher-than-expected economic growth and inflation. In addition to concerns about Asia, earnings reports and economic data will also be in focus. The news of an 11.1% surge in China''s economy in the first quarter offset strong corporate news released by Merrill Lynch & Co. (MER), Bank of America Corp.(BAC), Merck & Co. (MRK), and eBay Inc. (EBAY). Among the most notable profit gainers, Schering-Plough (SGP) reported a 52% rise in Q1 profit to $565 million, or 36 cents a share, topping estimates. The stock surged 7% in early trading. Merck & Co. (MRK) advanced 0.4% after it said its Q1 profit jumped 12% to 78 cents per share on strong sales.

On the economic news front, the Labor Department said weekly applications for unemployment benefits dropped by 4,000 to 339,000. The Conference Board is expected to release its March leading economic indicators, and the Philadelphia Federal Reserve is due to report on regional manufacturing activity. In the first hour of trading, the Dow Jones industrial average fell 42.26, or 0.33%, to 12,761.58. The Standard & Poor''s 500 index fell 7.42, or 0.50%, to 1,465.08. The S&P hit a new 6 1/2-year high Wednesday. The Nasdaq composite index fell 20.16, or 0.80%, to 2,490.34. Bond prices rose for the fourth straight session, with the yield on the benchmark 10-year Treasury note falling to 4.64% from 4.66% late Wednesday.

Initial jobless claims fell by 4,000.
The Department of Labor released its report on initial jobless claims in the week ended April 14 on Thursday, showing that jobless claims fell less than economists had been expecting after surging higher in the previous week. The report showed that jobless claims fell to 339,000 from the previous week''s revised figure 343,000. Economists had expected jobless claims to fall to 320,000 compared to the 342,000 originally reported for the week ended April 7. The modest decrease came after jobless claims surged higher in the previous week, rising to 343,000 from 323,000 in the week ended March 31. The Labor Department also said that the less volatile four-week moving average rose to 328,750 from the previous week''s revised average of 323,500. The report also showed that continuing claims in the week ended April rose to 2.531 million from the preceding week''s revised level of 2.525 million.


9:30AM FTSE 100 declines Thursday on heavy losses in Asian markets.
The UK market was lower on Thursday. By mid-day, the FTSE 100 42.7 points, or 0.7%, lower to 6,406.0.

Advancers

Mid-cap WH Smith led the advancers, up 2.8%, supported by a 7% rise in first-half profit before tax. The book and stationery retailer announced that while it remained cautious about consumer spending in its markets, it was confident in the outcome for the full year.

Life assurer Prudential gained 0.6% after it reported an 8% increase in sales on an annual premium equivalent basis.

Defensive drug stocks also advanced, with GlaxoSmithKline up 0.7% and AstraZeneca 0.6% higher.

Decliners

Mining stocks, widely seen as a proxy for global and Chinese growth, were hit the worst, with Antofagasta down 2% and Kazakhmys 1.5% weaker. Rio Tinto was down 1.7% despite an upbeat production report.

Oil large-caps were also lower as the price of crude oil dipped below $63 a barrel. BP slid 1.1% while BG Group and Royal Dutch Shell both dropped 0.8%.

Fund managers were also weak as equities markets are under pressure. Amvescap fell 2.2%.