1:00PM NY - European markets finished notably higher.
European stocks closed notably higher, ending a five-session losing streak. European gains followed a global markets rebound, with investors buying shares in companies that have been hurt by the recent reduction in risk appetite. Salzgitter shares rose 5.6% after Credit Suisse upped its rating to outperform from neutral. Other companies which have been pressured over the past week included miner Xstrata which rose 3%, and building materials firm Vinci, climbing 3.5%. Among other companies in focus, Novartis advanced 4.8% after the Swiss drug maker said it won U.S. FDA clearance for its high-blood-pressure treatment Tekturna. Smaller drug maker Speedel Holding surged 26%. Shares of International Power rose 6.9% after it reported a 44% profit rise on higher power prices in the U.K. and lifted its dividend 75%. The German DAX Xetra 30 closed up 0.9% at 6,595, the French CAC 40 rose 1% to 5,437.13 and the U.K. FTSE 100 advanced 1.2% to 6,138.50.


11:30AM Stock averages remained in the positive. Google and Apple boosted tech stocks.
U.S. stocks pulled off their best trading levels but remained in the positive. A report which showed a bigger-than-expected drop in factory orders erased some of the earlier gains. The Dow was led higher by financial stocks which bounced back after heavy losses. Citigroup (C: chart)gained 1.5%, as the company plans to buy a majority stake in Japan''s troubled Nikko Cordial brokerage. J.P. Morgaan (JPM: chart) gained nearly 1% ahead of the company''s presentation to investors. Blue-chip company Altria Group (MO: chart) rose 1.8% after Deutsche Bank upgraded its stock to buy, noting opportunities to unlock value through a restructuring. Google helped push the tech-heavy Nasdaq higher on the back of news that the company is working together with Apple on new projects. Google (GOOG: chart) shares rose 2.2%, while Apple (AAPL: chart) added 1.5%.

By sector, real estate investment trusts, gold and oil service stocks were leading gainers. Financial stocks were notable advancers, recovering from weakness brought by subprime mortgage lenders. New Century Financial Corp. (NEW: chart) rose 25% on Tuesday after its stock plummeted nearly 70% yesterday. Fremont General Corp. (FMT: chart) rose 13%. Homebuilders joined the overall recovery, led by gains in the likes of Beazer Homes USA (BZH: chart), rising 2.7%, Centex Corp. (CTX: chart), up 2.9% , Ryland Group (RYL: chart), higher by 2% and Toll Brothers (TOL: chart), up 1.8%. The Dow rose 47.66, or 0.40%, to 12,098.07. The Standard & Poor''s 500 index was up 8.02, or 0.58%, at 1,382.14, and the Nasdaq composite index, especially hard hit over the past week, rose 21.24, or 0.91%, to 2,361.92.

Factory orders fell more than expected in January.
The Department of Commerce released its report on new orders for manufactured goods in the month of January on Tuesday, showing that orders fell even more than economists had been expecting following two consecutive monthly increases. The report showed that new orders for manufactured goods fell 5.6 percent in January following an upwardly revised 2.6 percent increase in December. Economists had expected orders to fall 4.0 percent compared to the 2.4 percent increase originally reported for the previous month. The decrease in orders reflected a drop in orders for both durable and non-durable goods. The report showed that orders for durable goods fell 8.7 percent, while orders for non-durable goods fell 2.0 percent. The report also showed that shipments of manufactured goods fell 1.2 percent in January following a 1.3 percent increase in December. Shipments of durable and non-durable goods both fell during the month. The Commerce Department also said that inventories of manufactured goods fell 0.2 percent in January following ten consecutive monthly increases. The inventories-to-shipments ratio edged up to 1.23 in January from 1.22 in December.


9:45AM U.S. stock markets opened sharply higher, led by financial shares.
U.S. stock markets rallied at opening, with the three major indexes pushing higher after five sessions of massive losses. A rebound in Asian markets and strengthening dollar boosted market sentiment. The Dow Jones industrials gained over 100 points before edging back. 29 of the 30 Dow components traded in the positive, including Alcoa Inc. (AA: chart), up 1.3%, American Express (AXP: chart), also up 1.3%, and Hewlett-Packard Co. (HPQ: chart), rising 1.5%. Another blue-chip company, Altria Group (MO: chart) gained 1.6% following an upgrade by Deutsche Bank, which noted opportunities to unlock value through a restructuring.

Financial stocks led market higher, recovering from steep losses. Century Financial Corp. (NEW: chart), which plunged 70% on Monday, rose 14.9% in early morning. Shares in Citigroup (C: chart) rose 1.5% after the financial services company announced plans to buy a majority stake in Japan''s Nikko Cordial brokerage in wjhat would be the largest acquisition of a Japanese brokerage by a foreign company. J.P.Morgan (JPM: chart) supported the blue-chip average with a gain of 1% ahead of the company''s presentation to investors later in the day.

The tech-heavy Nasdaq was led higher by Google (GOOG: chart), which rose 2% after its CEO said on Monday that Google and Apple (AAPL: chart) are involved together in ''many more'' new projects, which he did not identify. In economic news, the Labor Department said that Q4 productivity was revised was revised down to a 1.6% annual growth rate from the 3.0% estimate a month ago. Unit labor costs rose to 6.6% annual pace in the quarter, revised higher from a 1.7% increase. The Dow rose 72.98, or 0.61%, to 12,123.39. The Standard & Poor''s 500 index was up 10.84, or 0.79%, at 1,384.96, and the Nasdaq composite index, especially hard hit over the past week, rose 24.91, or 1.06%, to 2,365.59.

Labor productivity revised down 1.6% in Q4. Costs revised sharply up.
Tuesday morning, the Department of Labor released its revised report on productivity and unit labor costs in the fourth quarter. While productivity growth was revised down roughly in line with estimates, the report also showed a significant upward revision to unit labor cost growth. The report showed that non-farm productivity growth was revised down to 1.6 percent for the fourth quarter compared to the previously reported 3.0 percent growth. Economists had been expecting productivity growth to be revised down to 1.7 percent. The downward revision to fourth quarter productivity growth came as the pace of output growth was revised down to 2.5 percent from 4.2 percent. The pace growth in hours worked was also revised down to 0.9 percent from 1.2 percent.

Despite the downward revision, the productivity growth that was seen in the fourth quarter still represents an improvement from the 0.5 percent decline in productivity that was reported for the third quarter. The Labor Department said that the downward revision to productivity growth combined with a large upward revision to compensation to produce a rate of unit labor cost growth in excess of six percent. The report showed that unit labor cost growth for the fourth quarter was revised up to 6.6 percent from the previously reported 1.7 percent. The upward revision came in well above economist estimates of 3.2 percent growth. The revised increase in unit labor costs in the fourth quarter marked the biggest increase since a 9.1 increase in the first quarter of 2006, although the increases in were both periods were due in large part to big bonuses paid to high-income workers.


9:30AM London market gains ground Tuesday with miners helping the advance.
The UK market advanced in early trade on Tuesday. The FTSE 100 was 53.4 points higher at 6,112.1 at mid-day.

Advancers

Miner Xstrata was higher 4.4%, topping forecasts with a 119% increase in underlying profits last year, supported by strong copper and nickel prices. Net profit soared to $4.89 billion, including a full year from acquisitions, compared with forecasts of $4.6 billion. The news supported other miners, which rose in sympathy. Antofagasta rose 2.6% and Anglo American was 2.5% stronger.

International Power led the gainers, up 6.2%, as the power generator raises its dividend by 75% and reported a 44% growth in operating profit of 773 million pounds. Takeover speculation sent Royal & Sun Alliance 2.6% higher on talk that the insurer final exit from the US had left it vulnerable to a bid. Sampo of Switzerland was the likely bidder. Legal & General, the life assurer, was also lifted by bid rumours. It gained 2.5%.

Decliners

British Airways, which lost 6.6% in the previous session, fell a further 0.7% on continued concerns about the possible introduction of liberal aviation services between the US and Europe.

Debt Free Direct plunged 4.9% as it warned that profits for 2007 are now expected to be around 10% to 15% below current estimates of between 9.7 million pounds to 10.3 million pounds.


9:00AM U.S. stock futures pointed higher, as overseas markets rebounded and the dollar gained ground.
U.S. stock market futures were indicating a higher opening on Tuesday, boosted by a recovery in overseas bourses after the steep global decline registered in recent sessions. Asian stock markets advanced, with the Nikkei 225 gaining 1.2% and the Hang Seng climbing 2.1%. European stock markets also moved higher. Investors were optimistic that the various worries have already been priced in. The U.S. dollar gained some ground against the rallying yen and helped provide further support to the pre-market sentiment. Oil and gold futures, hurt by the recent stock market drop, also rose in electronic trade. On the economic news front, January factory orders, statistics on January pending-home sales and Q4 productivity are due for release.