4:30PM Transportation stocks decline keep averages in check.

-Dow down 1.20 points, Nasdaq down 3.44 points and S&P 500 down 0.48.
-Yield on 10-year bond closed at 5.032% and 30-year bond closed at 5.099%.
-Crude oil gained 19 cents close at $73.94 per barrel.
-Gold gained $3.90 to close at $621.90 per ounce.

-In Asian Markets Japan closed 0.81% lower but India and Philippines rose near 2% and 1%. Australia lost 1% and South Korea was near unchanged.

-In European Markets closed fractionally higher led by 0.5% rise in the Netherlands and 0.3% in Germany.

-In Latin American Markets Brazil and Mexico led the region lower. Brazil lost 0.24% and Mexico lost 0.84%.

It was day of another loss in transportation sector. UPS (UPS: chart) dropped 6% in today’s trading after dropping 10% in yesterday’s closing. Norfolk Southern (NSC: chart) dropped 8.5% on the earnings disappointment. Other railroad stocks Burlington Northern (BNI: chart) and CSX (CSX: chart) fell 2.4% and 6% respectively in sympathy. Boeing (BA: chart) fell 4.6% or $3.85 to close at $79.90 on quarterly loss of $160 million on more than $1 billion in charges.

Choice Hotels (CHH: chart) lost 24% of its value on earnings report. The company reported second quarter earnings of 36 cents vs. 32 cents a year on revenue rise of 15%. Several analysts lowered the company rating after the report and annual earnings forecast of $1.45 per share. The stock closed $14.65 lower and closed at $44.20.

Getty Images (GTY: chart) dropped 18.28% on 35% decline in earnings to 35 cents a share from 53 cents a year ago. The company missed the analyst forecast of 64 cents before the options expenses and 61 after the expenses.

The latest survey conducted by Federal Reserve Board on economic climate showed a declining economy and consumers pulling back. The twelve districts reported that retailers catering to lower and middle markets are witnessing softening conditions but luxury retailers are still showing healthy gains.

European markets closed fractionally higher and in Asia Japan closed lower.


12:30PM European markets closed higher.
European markets finished in the positive as gains for companies like Reuters and Syngenta offset losses in the automotive sector. London business news and information group Reuters Group advanced 5% on lifted revenue outlook for the year and increased dividend for the first time in five years. Agrochemicals company Syngenta gained 4.8% on first-half income above estimates. Mining stocks also contributed to the positive sentiment, with Arcelor climbing 9%, and Xstrata rising 0.5%. Among decliners, Peugeot led the auto sector down with a decline of 10% on 60% profit drop in the first half due to higher raw material costs. Volkswagen and BMW also moved lower, 0.7% and 0.5% respectively. The German DAX 30 rose 0.4%, the French CAC 40 gained 0.2%, and London FTSE 100 climbed 0.4%.

Oil prices advanced on a large drop in gasoline stockpiles. Light crude September delivery rose 79 cents to $74.54 a barrel. London Brent gained 60 cents to $73.88. Gasoline futures added 2 cents to $2.307 a gallon. The dollar lost ground versus major currencies. The euro traded at $1.2609, up from $1.2583. The dollar bought 116.85 yen, down from 117.15. The British pound stood at $1.8461, up from $1.8399. European gold prices declined. In London the precious metal traded at $618.50, down from $621.10 per ounce. In Zurich gold traded at $616.15, up from $613.65. Silver closed at $10.96, up from $10.80.


11:30AM The Nasdaq underperformed the Dow and S & P 500.
The U.S. stock markets traded in the negative territory due to profit taking. The major averages lingered near their worst levels of the day, with the Nasdaq underperforming the Dow and the S&P 500. Transportation stocks continued to move to the downside, dragged by Norfolk Southern (NSC: chart), down 12% on weaker-than-expected Q2 earnings. The Dow Jones Transportation Average fell 3.6%. Losses by airline stocks are also contributed to the weakness in the broader transportation sector. Mesa Air (MESA: chart) dropped 6.8% after reporting disappointing quarterly earnings. Some defense stocks also came under pressure, with Dow component Boeing (BA: chart) down 4.4% on Q2 loss versus a year ago profit.

The technology sector moved notably to the downside, contributing to the sharp decline by the tech-heavy Nasdaq. Some internet and semiconductor stocks also posted considerable weakness. Among internet stocks, Amazon.com (AMZN: chart) stood out with a decline of 17.2%, reflecting Q2 earnings below analyst estimates. Office Depot (ODP: chart), Big Lots (BLI: chart), and Circuit City (CC: chart) also moved to the downside.

Meanwhile, some individual stocks bucked the downtrend. Shares of Mylan Labs (MYL: chart) rose 10.9% after the drug maker reported better-than-expected Q1earnings and raised its full-year guidance. Dow component General Motors (GM: chart) gained 4.5% as the automaker posted strong Q2 operating profit and raised its cost reduction target. n late morning trading, the Dow Jones industrial average fell 39.70, or 0.36%. The Standard & Poor's 500 index fell 5.60, or 0.44%, and the Nasdaq composite index fell 18.32, or 0.88%. Bonds rose as stocks fell. The yield on the 10-year Treasury note fell to 5.06%, down from 5.07% Thursday.

Crude oil inventories remained steady, while gasoline declined.
Crude oil inventories were unchanged in the most recent week, according to government statistics released Wednesday. Meanwhile, stockpiles of gasoline declined, reversing a gain posted in the previous period. The Department of Energy's Energy Information Administration said that crude oil inventories remained steady in the week ended July 21. Specifically, the measure held at 335.5 million barrels. The flat performance followed a gain of 200,000 barrels in the previous week - a build that broke a string of declines. Oil inventories for the July 21 week were 3.8% higher than last year. Meanwhile, gasoline inventories showed a week-over-week decline of 3.2 million barrels. This followed an advance of 1.5 million barrels in the previous week. The level of gasoline inventories was 0.2% above last year. Distillate fuel oil had an inventory advance of 800,000 barrels during the week. This built on a recent streak of gains, including an advance of 1.2 million barrels in the previous week.


10:30AM Market rallies for the third day in a row.
A day after rise in interest rates of 25 basis points, market continued its advance for the third day in a row. In the last three weeks Sensex index has risen 5.3% or 531 points. The index added 201.66 points or 1.94% to close at 10,617.27 on daily turnover volume of $543 million or Rs 2,446 crore. The daily volume still hovers near the years low despite the steep rise in the market averages in the last three days.

In the absence of economic news and a flood of earnings from large cap companies market devoted its total attention to the earnings. Several companies including Bharti Airtel, ONGC, Mahindra & Mahindra, Deccan Chronicle, Kirloskar Brothers and Bank of India dominated earnings news. Majority of the reporting companies delivered better than expected earnings.