4:00PM Stocks rose briefly before declining despite Fed keeping interest rates the same.

-Yield on 10-year bond closed at 4.93% and 30-year bond closed at 5.01%.
-Crude oil lost 67 cents to close at $76.31.
-Gold lost $2.20 to close at $650.90.

-Asian Markets were mixed, being led by Japan which closed ahead at 2.05%. Indonesia lost 0.53%.

-European Markets closed mixed, led by S. Africa which gained 0.53%, and Germany which gained 0.45%. Netherlands declined 0.20%.

-Latin American Markets were mixed, led by a 0.63% gain in Canada. Mexico lost 0.03%.

12:30PM European markets closed mixed.
European markets closed mixed in a light trading session ahead of U.S. Fed Reserve’s decision on interest rates. Positive earnings reports from several insurance companies generated some positive sentiment. Shares of Germany''s Hannover Re rose 1.1% on 2% rise in Q2 net profit and optimism about a very good result in 2006. Swiss reinsurance company Converium gained 1.1% on news its Q2 profit rose 33.3%. Outside the sector, German steelmaker Salzgitter gained 4.2% after it said that it will sell a 17% stake in France''s Vallourec, producer of steel tubes. The German DAX 30 rose 0.5%, the French CAC 40 gained 0.2%, while London FTSE 100 lost 0.2%.

Oil prices hit record highs on news BP was halting production at the biggest oilfield in the U.S., possibly for months. Light crude September delivery traded at $76.55 a barrel. London Brent surged to $77.90. The dollar traded lower versus major currencies. The euro traded at $1.2840, up from $1.2839. The dollar bought 114.96 yen, down from 115.07. The British pound stood at $1.9072, up from $1.9061. European gold prices declined. In London the precious metal traded at $644.38, down from $650.50 per ounce. In Zurich gold traded at $644.78, down from $650.38. Silver closed at $12.18, down from $12.40.


11:30AM Choppy trading ahead of Fed’s decision.
Stocks have been trading in a lackluster fashion since opening, with the three major averages moving up and down as traders seem reluctant to make any significant moves ahead of the release of the Federal Reserve''s decision on interest rates. Most economists expect the Fed to leave interest rates unchanged, but others predict another quarter point rate hike.

Despite the uncertainty over Fed’s decision, the interest-rate sensitive utilities sector showed some strength. At the same time, the interest-rate sensitive housing sector declined, dragged by Pulte Homes (PHM: chart) and Hovnanian (HOV: chart). Shares of Dow component International Business Machines Corp. (IBM: chart) rose 1.2% after an appeals court reversed a lower court decision that IBM''s shift to a new pension plan had discriminated against older employees. In late morning trading, the Dow Jones industrial average rose 35.78, or 0.32%. The Standard & Poor''s 500 index added 2.92, or 0.23%, and the Nasdaq composite index gained 4.13, or 0.2%. Bonds edged lower ahead of the Fed meeting, with the yield on the 10-year Treasury rising to 4.93% from 4.92% late Monday.


10:30AM India surges due to strong performance by large-caps.
The Sensex in India ended 202.33 points higher, or 1.87%, to 11,014.97. The Sensex moved in a range of 188 points between the highs and lows of the day. The turnover on BSE was Rs 2,130 crore, lower than the average turnover but higher than Monday''s Rs 2,040 crore. The market-breadth was strong with 1,574 shares that advanced and only 838 that declined. A total of 81 shares remained unchanged. Among the Sensex constituents, 27 advanced while only 3 declined.

ICICI Bank was the major gainer, rising 4.91% to Rs 596 on a high volume of 25.59 lakh shares. Other banking stocks also surged, as SBI climbing 2.69% to Rs 832.80 and HDFC Bank advancing 1.21% to Rs 813. ONGC gained 2.80% to Rs 1,194.05 as well, as oil prices rose sharply on Monday. Other advancers included Bharti Airtel surging 3.32% to Rs 405, Tata Motors notching up 2.21% to Rs 766 and ITC gaining 2.64% to Rs 172.90.

Other banking stocks also rallied. Bank of Rajasthan soared 7.50% to Rs 33, United Western Bank added 7.32% to Rs 21.25, Federal Bank gained 2.12% to Rs 180.75, Oriental Bank of Commerce was up 4.16% to Rs 172.75, Bank of Baroda moved up 3.40% to Rs 239, Kotak Mahindra Bank edged up 0.91% to Rs 287 and Vijaya Bank advanced 2.16% to Rs 45.

Index large-cap Reliance Industries surged 2.38%, to Rs 977.70 on 12.67 lakh shares on BSE. It moved in a range of Rs 979 and Rs 940. ICICI Bank was the most-traded stock on BSE with a total turnover of Rs 151.03 crore followed by Reliance Industries with Rs 122.84 crore and SBI with Rs 76.67 crore.

Tyre shares were in demand, rising for the second consecutive day, due to a fall in the price of natural rubber in the domestic and international markets. The decline in rubber price, on a sustained basis, augurs well for the tyre sector. Even after the recent fall, prices of natural rubber are too high. The commodity constitutes approximately 40% of the total input costs in the manufacture of tyres. TVS Srichakra advanced 10.11% to Rs 73, CEAT added 5% to Rs 89.10, JK Industries surged 6% to Rs 104.25, Goodyear India notched up 3.16% to Rs 97.80, Apollo Tyres edged up 1% to Rs 285 and MRF moved up 0.80% to Rs 3,266.

Other stocks also advanced. Ashok Leyland gained 1.80% to Rs 36.95, Great Eastern Shipping jumped 4% to Rs 232.90 on 10.06 lakh shares and IST surged 5.38%, to Rs 49 on plans to set up an IT special economic zone in Gurgaon and acquisition of Neil Builders.

BHEL led the decliners, falling 0.91% to Rs 2,166, surging to a high of Rs 2,219.95 in early trade, ahead of its board meeting today to consider proposals for bonus shares and a stock-split. Ranbaxy lost 0.43% to Rs 395.50 and Hero Honda fell 0.19% to Rs 668.75.


9:45AM Stocks opened higher on rates optimism and mergers.
U.S. stocks opened higher on optimism the Fed Reserve will keep its key interest rate steady at 5.25%. Yet a Labor Department report on productivity signaled threatening inflation increase. Economists fear that slower productivity and higher costs could lead businesses to increase prices, thus triggering inflation.