11:30AM Stock markets declined on weak oil and gold stocks.
Stock averages reversed from an earlier strength as a notable decline for Citigroup dragged banking stocks lower and lower crude oil prices pressured major oil companies. Dow component Citigroup (C: chart) dropped 2.4% after the company reported Q2 earnings and revenue that came in below analyst estimates. Oil prices retreated 73 cents to $76.30 a barrel, generating some selling pressure in morning trading. Oil service stocks posted significant weakness, sending the Philadelphia Oil Service Index down 2.5% and the Amex Oil Index down 1.5%. Losses by gold stocks also helped the market move lower. The losses came amid a significant decrease by the price of the precious metal, down $18.80 at $649.20 an ounce. Biotechnology stocks also came under pressure, with Biogen Idec (BIIB: chart) and Celgene (CELG: chart) turning in two of the sector''s worst performances. Meanwhile, some strength was visible in the disk drive sector, boosted by a notable advance in the shares of Adaptec (ADPT: chart) and M-Systems (FLSH: chart). In late morning trading, the Dow Jones industrial average rose 20.14, or 0.19%. The Standard & Poor's 500 index fell 0.44, or 0.04%, and the Nasdaq composite index climbed 2.73, or 0.13%.


10:30AM Sensex in Mumbai, India declined 3.17% on lack of buying and general weakness in Asian trading.
Rising oil price, weak Asian markets and declining trading volume in India kept the market averages falling at the opening in Mumbai trading. BSE index of 30 stocks opened weak. Mixed earnings from several companies did not encourage buyers. At close market lost 385 points or 3.17% to close at 10,343.80. Trading volume on Bombay Stock Exchange was recorded at rupees 1,739 crore ($400 million), one of the lowest for the year.

All thirty stocks in the Sensex index managed to close lower. Of the 2,432 shares traded, 655 rose, 1,713 declined and 64 were unchanged. Mid-cap and small-cap index on BSE declined 1.2%.

The earnings season is in full swing and most consumer and industrial companies are reporting solid gains.

Auto stocks declined on the earnings news from Bajaj Auto. The company reported first quarter earnings growth of 28% to rupees 266 crores from rupees 208 crores from a year ago. Sales for the company rose 37% to rupees 2,202 (or $500 million). The stock fell 2.5% to close at rupees 2,518 on the news. Local brokers had forecasted revenue rise of between 44% and 54% in the quarter.

With the news and rising oil prices dragged other stocks in the sector. Maruti Udyog lost 5.3% to close at rupees 753, Tata Motors dropped 5.85% to close at rupees 696 and Ashok Leyland dropped 5% to close at rupees 32. Mahindra & Mahindara lost 6% to close at rupees 551. Rising oil price in the international markets were worrying to the investors.

ICI India rose 3% on the news that the company is planning a share buy back worth rupees 125 crores at a share price below rupees 350. The stock closed at rupees at 303.

McDowell & Company reported solid quarterly results. The sales rose 63% in the quarter to rupees 533 crores and earnings rose whopping 234% to rupees 34.68 crores. The beer and liquor company stock gained 1% to close at rupees 498.

India Cement based in South India, lost 2.5% to close at rupees 180 on the earnings news. The company reported revenue rise of 27% and earnings growth of 2,000%. The company revenue was reported that at rupees 485 crores and earnings of rupees 112 crores. Deepak fertilizer rose 12% on earnings jump of 10% on revenue growth of 28%. The stock closed at rupees 77.85.

In other markets in Asian trading, Tokyo and South Korea were closed due to a local holiday, but in Hong Kong closed 0.5% and in Taiwan closed 2.7% lower.


9:45AM Stocks edged up at opening on strong economic data.
Stocks opened modestly higher in early trading Monday as strong manufacturing data helped offset market jitters about the escalating fighting in the Middle East and a series of bland earnings reports, the latest from Citigroup (C: chart). The Fed Reserve reported that industrial production rose 0.8% in June, far better than the 0.4% growth economists had expected. Despite the ongoing violence in Israel and Lebanon, oil prices moved down, with a barrel of light crude quoted at $76.25, down 78 cents, on the Nymex.

The decrease by the price of oil eased concerns about higher fuel costs, helping airline sector recover from recent decline and sending the Amex Airline Index up 0.7%. At the same time, energy stocks posted some weakness. The Philadelphia Oil Service Index fell 1.5%, while the Amex Oil Index was down 1%. Disk drive stocks moved notably to the upside in early trading, lifted by 7.7% gain for Adaptec (ADPT: chart). The manufacturer of storage products and software gained after Morgan Keegan upgraded its rating on the stock to Outperform from Market Perform. Some early strength also emerged in the health insurance sector, with Sierra Health (SIE: chart) and Coventry Health Care (CVH: chart) posting notable gains. In the first hour of trading, the Dow Jones industrial average rose 28.34, or 0.26%.The Standard & Poor''s 500 index added 0.81, or 0.07%, and the Nasdaq composite index climbed 6.88, or 0.34%.

Industrial production rose more than expected.
Monday morning, the Federal Reserve released its report on industrial production and capacity utilization in the month of June. The report showed that production rose more than economists had been expecting. The report said that industrial production rose 0.8 percent in June following a 0.1 percent decrease in May. Economists had been expecting production to increase by a more modest 0.4 percent. The increase was partly due to a notable increase in output from mines, which rose 1.2 percent in June following a 0.3 increase in May. Output from utilities also increased, rising 0.7 percent in June after a 0.2 percent increase in May. The report also showed that manufacturing output increased 0.7 percent in June following a revised 0.1 percent increase in May. The originally reported showed that manufacturing output fell 0.1 percent in May. The Federal Reserve also said that capacity utilization increased to 82.4 percent in June from 81.8 percent in May. With the increase, the capacity utilization rate came in above economist estimates of 82.0 percent.


9:00AM Stock futures pointed to a lower opening on geopolitical tension.
After a brief advance, U.S. stock futures moved to the downside, pointing to a lower market opening, as investors grew worried over the conflict in the Middle East. Earnings reports were pushed to the backseat, failing to provide a boost to the market.

Citigroup Inc. (C: chart) the world''s largest bank by market value, reported a profit in line with the analysts'' estimates. The financial services institution posted Q2 profit growth of 4% to $5.27 billion, or $1.05 per share, up from $5.07 billion or 97 cents a share a year ago. Shares dipped 0.2%to $47.48 before the opening bell. Motorcycle maker Harley-Davidson Inc. (HDI: chart) reported a 3% rise in quarterly earnings to $243.4 million or 91 cents per share versus $237.4 million, or 84 cents per share a year ago. Other companies due to report earnings Monday include Web search company Yahoo Inc. (YHOO: chart) which will report after the market''s close.

Shares of Apple Computer Inc. (AAPL: chart) rose 1.6% to $51.46 before the opening bell on reports that that the stock could rebound over the next year as interest in the company''s Macintosh computers picks up. Shares of General Motors Corp. (GM: chart) could also be in focus on news that its board of directors will hold a conference on Monday to discuss a potential alliance with Renault SA and Nissan Motor Co. Standard & Poor''s 500 futures were down 3.2 points, just slightly below fair value. Dow Jones industrial average futures were down 18 points, and Nasdaq 100 futures were down 1.75 points.

Commerce Bancorp Inc. (CBP: chart), a regional bank, reported that its second-quarter earnings slightly advanced in spite of revenue growth as the low long-term interest rates tightened margins. Net income grew to $79.5 million from $79.4 million a year earlier. EPS declined to 41 cents from 46 cents a year ago, while the average shares outstanding number rose 9% percent to 193.8 million. Net interest income climbed 11% from last year to $318.9 due to an increase in the volume of interest-earning assets. Loans gained 34% to $14.1 billion from last year. The bank''s service fees rose 33% driving the non-interest income up 24% from a year ago to $143 million.