11:30AM New York – U.S. stocks fell after weaker than expected sales in December and profit warnings dragged market sentiment.

U.S. stocks fell in the early morning trading after weak retail sales and on profit warning from Wal-Mart and Macy’s dragged indexes lower. The stocks fell for the second day in a row.

Wal-Mart dropped 9% after it lowered fourth quarter earnings estimate and indicated same store sales in January between zero and less than 2%.

Wal-Mart Stores, Inc. (WMT) December month sales decreased 0.1%.

Net sales at Wal-Mart Stores increased 4.3%, at Sam’s Club declined 2.1% and international sales fell 10.4%. November comparable store sales increased at domestic Wal-Mart locations by 1.9% and Sam’s Club by 0.1%.

BJ''s Wholesale Club, Inc (BJ) same store sales in December sales rose 1.6%, including negative impact from sales of gasoline fall 4.3%, merchandise comparable club sales rose 5.9%. Total sales in the month increased 3.2% to $1.06 billion from $1.03 billion in the prior year month.

Kohl’s Corporation (KSS) reported total sales for the five-week period ended January 3, 2009 increased 3.6% from a year ago. On a comparable basis same store sales fell 1.4% in the month.

Macy’s and Gap lowered earnings estimates but Sears Holdings Corp issued estimates of earnings per share excluding certain items between $2.44 and $3.09, higher than expected.

Jobless Claims Rise

Initial claims at the end of last week declined 24,000 to 467,000. Total number of people on the benefits rose to 4.6 million, record high since 1982.

The President-elect Obama in a speech delivered in Fairfax, Virginia said that annual budget deficit will increase more than $1 trillion and hinted that deficit may stay higher than that for many years to come.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 362.82 or 3.93% to 8,876.42, Hang Seng index in Hong Kong decreased 571.55 or 3.81% closed to 14,415.91 CSI 300 index in China lower 43.19 or 2.24% closed to 1,887.99. ASX 200 index in Australia decreased 85.40 or 2.26% to close 3,694.30. The KL Composite index in Malaysia lower 17.10 or 1.84% closed to 910.52.

The Kospi Index in South Korea decreased 22.47 or 1.83% to close at 1,205.70. SET index in Thailand closed higher 2.07 or 0.45% to 465.03 and JSE Index in Indonesia decreased 18.81 or 1.32% closed to 1,402.66. Markets of India were closed today.

Europe Markets Review

In London FTSE 100 Index traded lower 48.33 or 1.07% to 4,459.18, in Paris CAC 40 Index decreased 49.42 or 1.48% to 3,296.67 and in Frankfurt DAX index traded lower 56.79 or 1.15% to 4,880.68. In Zurich trading SMI decreased 40.70 or 0.71% to 5,720.99.