11:30AM The Nasdaq gained on strong disk drive sector.
Stocks traded mixed to lower late Monday morning as investors locked in recent gains. The major averages subsequently moved well off their worst levels of the day. Blue chips dropped due to the conflict in the Middle East and disappointing profit reports. Boeing (BA: chart) shares dropped 1.1% on the Nymex, while GE (GE: chart) shares fell 0.7%. The tech-heavy Nasdaq benefited from strength in the disk drive sector, contributed by news that M-Systems agreed to be acquired by SanDisk (SNDK: chart) for $1.35 billion in stock. A brokerage upgrade of Apple Computer Inc. (AAPL: chart), which rose 4%, also boosted the Nasdaq. The brokerage also upgraded National Semiconductor Corp. (NSM: chart) to ‘outperform’ from ‘market perform,’ sending the stock up 1.3%.

The increase by the price of oil generated selling pressure among oil-sensitive airline stocks. Some biotechnology and housing stocks also moved sharply lower. However, the energy sector helped to limit the downside for the major averages. The health insurance sector also moved to the upside on bargain hunting. The stock of M-Systems surged 13.2%. Among other stocks, shares of copper miner Phelps Dodge Corp. (PD: chart) jumped 6.3% after Canada's Teck Cominco Ltd. sweetened its offer for base metals producer Inco Ltd. In late morning, the Dow Jones industrial average fell 18.41, or 0.16%. The Standard & Poor's 500 index lost 1.14, or 0.09%, and the Nasdaq composite index rose 1.78, or 0.09%. Bonds were little changed, with the yield on the benchmark 10-year Treasury steady at 4.99% from late Friday.


10:30AM The Indian Sensex ends with a moderate gains on selling pressure.
The Sensex in India finished with a gain of 63.65 points, or 0.60%, to 10,743.88. The market-breadth on BSE was positive led by broad rally from large to small caps and mid-caps. In the session 1,490 shares advanced, 945 declined and 64 stocks were unchanged. The daily turnover on Mumbai Stock Exchange was at $503 million or Rs 2,264 crore.

The top gainers BHEL advanced 3.83% to Rs 2,043.00. The company posted 85% surge in net profit to Rs 236.7 crore for Q1 June 2006 compared to Rs 127.9 crore a year ago. Largest auto maker, Maruti gained 2.55% to Rs 788.00 on decline in global crude oil price. Software exporters were on the gainers list. Satyam advanced 2.07% at Rs 752.50, Wipro gained 1.80% to Rs 491.00 and Infosys Technologies was up 1.35% to Rs 1,651.

ICICI Bank advanced 1.35% to Rs 550. The stock recovered from an early low of Rs 544.90 on bottom fishing. Reliance Industries slid marginally to Rs 979.50 on 1.3 million shares. It traded in a range of Rs 997.50 and Rs 977.15.

On the list of leading decliners, Hindustan Lever, lost 4.89% to Rs 230.40, despite reporting 35% growth in Q2 June 2006 net profit to Rs 381 crore compared to Rs 282 crore a year ago. Grasim shed 2.01% to Rs 2,075, in spite of reporting 24% growth in Q1 June 2006 net profit to Rs 311.90 crore, surpassing market expectations. ACC dipped 1.37% to Rs 837, Hindalco shed 1.11% at Rs 160.65 and ONGC sank 0.94% to Rs 1,170.


9:45AM Stocks opened in the negative.
Stocks opened lower Monday, reflecting investor cautiousness due to the intensifying violent Mideast conflict, higher oil prices and several disappointing earnings reports. Tyson Foods and Valero LP released disappointing earnings forecasts adding to the market''s concerns. Traders were inclined to take profits after the last-week rally and wait for Labor Department’s job creation report on Friday.

Tyson (TSN: chart), the world''s largest meat processor, reported Q3 profit loss of 15 cents per share, compared with a profit of 36 cents per share last year due to 5% revenue decline and legal charges. Tyson also lowered its future profit forecasts, and dropped 8.4%. Valero (VLI: chart) fell $1.16 to $50.78 after the energy company reported profits below analysts'' estimates despite a more than fourfold increase in revenues, as well as disappointing guidance for the second half of the year. Dow component Wal-Mart Stores (WMT: chart) added 40 cents to $44.86 after the retailer reported July same-store sales, increased 2.4%.

The airline sector turned in one of the market''s worst performances, partly due to an increase by the price of oil. AMR (AMR: chart) and Continental (CAL: chart) posted significant losses. Meanwhile, bargain hunting contributed to some strength in the health insurance sector, with Humana (HUM: chart) up 4.9%, helping to lead the health insurance sector higher after reporting better-than-expected Q2 earnings.

Some disk drive stocks also advanced, with shares of M-Systems (FLSH: chart) up 13.2% after the company agreed to be acquired by SanDisk (SNDK: chart) for $1.35 billion in stock. In the first hour of trading, the Dow Jones industrial average fell 35.54, or 0.32%. The Standard & Poor''s 500 index lost 3.01, or 0.24%, and the Nasdaq composite index dropped 9.95, or 0.48%. Bonds edged lower after Friday''s rally, with the yield on the benchmark 10-year Treasury note rising to 5% from 4.99% late Friday.


9:00AM Stock futures pointed to a lower opening due to the Mideast conflict.
U.S. stock futures declined early Monday as investors closely watching the developments in the Middle East were disappointed there is still no ceasefire agreement. However, U.S. Secretary of State Condoleezza Rice said such an agreement could be reached this week.
Mining stocks are expected to trade actively today as Copper miner Phelps Dodge Corp.''s (PD: chart) jumped more than 4% after Canada''s Teck Cominco Ltd. sweetened its offer for base metals producer Inco Ltd. The rival bid for Inco increases the prospect that Phelps'' offer for the miner could fall through.

On the earnings front, health insurer Humana Inc. (HUM: chart) reported a stronger-than-expected quarterly profit, but Avon Products Inc. (AVP: chart), the world''s largest direct seller of cosmetics, posted a profit below forecasts, citing restructuring charges. Shares of SanDisk Corp.''s (SNDK: chart) slipped by 0.3% to $47, a day after the maker of flash memory said it would buy Israel-based Msystems Ltd. (FLSH: chart) for $1.55 billion in stock. Shares of Apple Computer Inc. (AAPL: chart) rose 1.7% on Inet after Banc of America raised its rating on the stock. In other ratings news, Prudential raised its rating on Phelps Dodge. S&P 500 futures were down 2.10 points, below fair value. Dow Jones industrial average futures fell 21 points, and Nasdaq 100 futures dropped 1.5 points.


Gehl Co, (GEHL: chart), maker of agricultural and construction compact equipment, reported Q2 earnings of 75 cents a share, up from a profit of $5.6 million, or 53 cents a share a year-ago. On a continuing operations basis, the company posted a profit of 75 cents a share for Q2. Sales advanced to $139.5 million from $128.3 million in the same period a year earlier. The analysts’ estimate was for a profit of 73 cents a share. Gehl reaffirmed a forecast for earnings from continuing operations of $2.20 to $2.30 a share in fiscal 2006 on sales of between $485 million and $495 million. This outlook includes an estimated 6 cents a share in stock option expensing.

Cal-Maine Foods, (CALM: chart), egg producer, reported Q4 loss of a penny per share, narrower than a loss of 28 cents a share a year-ago. Sales advanced to $129.4 million from $81.5 million in the same period a year earlier. During the last year, the company said that egg supply has been greater than demand for most of the time. This has resulted in low egg prices. The company was pleased with its net results in light of market conditions.

Humana Inc, (HUM: chart), health-benefits provider, said Q2 net income advanced to $ 53 cents a share, from 49 cents a share a year earlier on a better-than-expected performance from the group''s Medicare advantage plan. The company topped analysts’ forecast for earnings of 35 cents a share. Revenue climbed 53% to $5.4 billion.

HSBC Holdings, (HBC: chart), banking services company, reported that first-half net profit advanced 15% to $8.73 billion as total operating income jumped 15% to $34.33 billion. Pretax profit soars 18% to $12.52 billion, topping analyst forecast of $11.47 billion. HSBC posted a rise in pretax profit across all its major regions, with North American pretax profit rising 15.1% to $4.27 billion and European pretax profit up 24.7% at $3.6 billion. In Hong Kong, pretax profit gained 9.7% to $2.65 billion. The bank added it saw strong momentum from its corporate and investment banking division, where pretax profit rose 37%.