U.S. MARKET AVERAGES

After higher opening ahead of economic data release, stocks returned to the flat trading level as investors digested Labor Department jobless claims report and consumer prices index for August. The CPI rose by 0.5% despite soaring gasoline prices of 8.3%, the biggest increase since February 2003. The low inflation numbers gave investors good ground to hope that the Fed Reserve will not increase interest rates.

The Labor Department reported that 68,000 people became jobless as a result of Hurricane Katrina and filed for unemployment benefits last week.

Gold sector was again one of the biggest gainers together with oil service space which advanced by 1.3%. Housing and biotech stocks showed only modest gains.

The airline sector declined 2.5% on reactions to bankruptcy filing from Northwest and Delta.

MOVERS AND SHAKERS

UICI (UCI: chart) jumped 15% after it has agreed to be bought by an assembly of private equity firms headed by Blackstone Group.

Bear Stearns (BSC: chart) fell 2.1% due to its earnings report that stated earnings of $378.3 million, or $2.69 a share, which is only little higher than the expectations of $2.38 a share.

Google (GOOG: chart) dropped 0.9% after the search engine priced its secondary offering at a slight decrease.

Motorola (MOT: chart) was 0.8% higher after a report in The Wall Street Journal saying that the company took advisers to explore the sale of its automotive unit.

Boeing (BA: chart) could be in play after Prudential Equity Group warned about possible feedbacks from a machinists' strike.

ECONOMIC NEWS

Consumer prices continued higher in the month of August, according to a report from the Department of Labor, although the increase came in line with economist estimates. Nonetheless, the report did not include much of the impact of Hurricane Katrina.

The Labor Dept. said that the consumer price index rose 0.5 percent in August, matching the increase seen in the previous month. Most economists had been expecting prices to increase by 0.5 percent.

The increase in consumer prices was largely due to a sharp rise in energy prices, which rose 5.0 percent in August following a 3.8 percent increase in July. The increase reflected a 7.9 percent increase in prices for energy commodities and a 1.3 percent increase in prices for energy services.

The report also showed that the core CPI, which excludes food and energy prices, rose by 0.1 percent for the fourth consecutive month. The increase came in slightly below economist expectations of an increase of 0.2 percent.

The number of people filing for first-time unemployment benefits surged in the most recent week, according to government data released Thursday, due largely to the impact of Hurricane Katrina.

The U.S. Labor Department reported that initial jobless claims jumped to 398,000 for the week ended September 10, up 71,000 from the previous week's revised figure. The sharp advance during the week came as a large number of people displaced by Hurricane Katrina filed for unemployment benefits.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks ended mixed after higher trading at mid-day as stock markets shrugged off rising crude-oil prices. The Japanese stocks climbed 1.2% on economic data, showing improved household confidence, while Taiwan’s shares dropped 1.1% on raised interest rates. Across the region, Hong Kong’s Hang Seng lost 0.3% and South Korea’s Kospi fell 0.1%.

European stocks traded mostly higher at mid-day. The German DAX 30 was flat ahead of general elections on the weekend. In the other regional markets the French CAC 40 added 0.4% and London’s FTSE 100 climbed 0.5% as both stock markets made gains on the back of strong oil and mining sectors.