U.S. MARKET AVERAGES

U.S. major stock averages rebounded from trading in the positive and turned lower when oil prices started a new surge after natural gas hit a record of $13.39, rising 5.8%, leading crude oil, distillate and gasoline prices also higher. Crude oil futures surged on the weekly oil inventory report, showing a surprising increase of gasoline inventories and lower-than-expected drawdowns of heating oil and other distillates. The report also said crude oil stocks were far lower than expected. Recently a barrel of light crude was quoted at $66.50, up $1.43, on the New York Mercantile Exchange.

In earlier dealings market regained sentiment on strong showing from America's manufacturing sector as investors' concerns about a slowing economy eased on better-than-expected durable goods report.

The housing sector is one of the worst performers of the day, showing a current decline of 1.3%. The retail sector has dropped below a 3-session trading range.

The energy stocks post modest gains. Utility stocks are also strong. The networking sector has come off its intraday peak but still up 1.3%.

Broader stock indicators also rose. The Standard & Poor's 500 index gained 1.63, or 0.13 percent, to 1,217.29, and the Nasdaq composite index climbed 1.85, or 0.09 percent, to 2,118.27.

Bonds edged slightly higher, with the yield on the 10-year Treasury note falling to 4.28 percent from 4.29 percent late Tuesday.

MOVERS AND SHAKERS

DaimlerChrysler (DCX: chart) rose 2%. The company benefited by a report published in a German newspaper saying that it is cutting 8,000 jobs at its Mercedes unit, more than previously reported 5,000.

General Motors Corp. (GM: chart) is expected to be active. The company and the Canadian Auto Workers union agreed to a three-year contract yesterday, in order to avoid a future high-priced strike.

Eastman Kodak (EK: chart) also is likely to be in play, because the company said it hopes total digital revenue growth for 2005 will be more than the originally expected 36%, while the year's digital earnings from operations, which were expected to increase by more than 300%, are now projected to be behind the target that company set at the beginning of 2005.

ECONOMIC NEWS

On Wednesday, the Commerce Dept. has released its report on durable goods orders in the month of August, showing much better than expected growth. However, because the data does not include the impact of Hurricane Katrina, the significance of the report is likely to be relatively limited.

The report showed that durable goods orders rose by 3.3 percent in August following a downwardly revised 5.3 percent decrease in July. Economists had been expecting orders to increase by a more modest 1.0 percent compared to the 4.9 percent drop originally reported for July.

The growth in durable goods orders was partly due to a significant increase in orders for computers and electronics products, which rose 5.5 percent in August after falling 6.5 percent in July. Orders for primary metals, fabricated metal products, machinery, and transportation equipment also had significant increases.

The Commerce Dept. also noted that excluding orders for transportation equipment, orders rose 4.2 percent in August after falling 3.7 percent in July. Orders for transportation equipment rose 1.4 percent in July following an 8.7 percent decrease in July.

Government data released Wednesday showed that crude oil inventories recorded another drop in the latest week, adding to a recent string of declines. However, stocks of gasoline advanced again during the period, adding to the surprise gain they posted in the previous week. The Department of Energy's Energy Information Administration revealed that crude oil inventories dropped by 2.4 million barrels for the week ended September 23, falling to 305.7 million barrels from the 308.1 million barrels recorded in the previous week. This followed a decline of 300,000 barrels for the prior week. Even with the recent declines, oil inventories remain 11.4% higher than their levels of the same time last year.

Gasoline inventories posted a week-over-week advance of 4.4 million barrels, adding to the 3.4-million-barrel gain posted in the prior week. Gasoline stocks are now only 2.9% below their levels of last year. Inventories of distillate fuel oil fell by 500,000 barrels for the most recent week.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks finished mixed. The Nikkei rose 1% on exporter issues, boosted by the weaker yen with automakers Toyota Motor and Honda Motor sharply up, offsetting losses posted by chipmakers after J. P. Morgan downgraded the semiconductor sector. Across the region South Korea’s Kospi reached another high, rising 1.6% on upbeat earnings expectations. Hong Kong’s Hang Seng gained on property stocks. Markets in Australia, Singapore and Thailand closed down.