10:00AM New York – U.S. stocks decline at the opening.

U.S. market averages opened lower on the worries related to rising inflation and more losses in sub-prime lending. Dow Jones Industrial Average declined 45 to 13,186, Nasdaq lost 4 to 2,640, and S&P 500 edged 6 lower to 1,464.

The Labor Department reported that October consumer price index increased 0.3% and index excluding food and energy costs increased 0.2%. The department also said that initial claims of unemployment at the end of the last week increased 20,000 to 339,000.

J.C. Penney (JCP: chart) reported third quarter earnings from continuing operations of $261 million or $1.17 per share including one-time tax credit of $32 million or $0.14 per share. Earnings in the quarter in the previous year were $286 million or $1.26 million. The company also issues cautious outlook and lowered its guidance for the fourth quarter and for the full-year.

For the fourth quarter the company lowered the earnings in the range between $1.65 and $1.80 per share from the previous estimate of $2.41 per share. For the fiscal year 2007 company now expects to earn in the range between $4.63 and $4.78 from the earlier estimate of $5.50 per share.

European markets traded lower at mid-day. Germany led the decliners in the region with a loss of 1.4% followed by losses in Norway of 1.3%, in the Netherlands of 1.25%, in France of 1.2%, in U.K. of 1.1%, and in Spain and Switzerland of 0.5%.

Barclays in London trading jumped 3% after it released its earnings but lost its gains turned negative with the market weakness ahead of the U.S. market opening. Barclays wrote down leveraged assets and trading charges totaling 1.3 billion pounds at its unit Barclays Capital.

Barclays Capital’s net income and profit before tax for the ten months ended 31st October 2007 exceeded the record net income and profits of the equivalent prior year period.

Profit before tax of £1.9bn for the period was after booking credit, mortgage and leveraged finance related charges and write downs of £0.5bn net of hedging in the third quarter; and an additional £0.8bn net charges and write-downs in October. The charges and write-downs are net of a gain of £0.2bn in each of the third quarter and October arising. The October charges and write downs reflected the impact of rating agency downgrades on a broad range of CDOs and the subsequent market downturn.

The bank further added in the press release, “Our trading book inventory at 31st October 2007 included £0.2 billion of assets from the drawdown of SIV-lite liquidity facilities (30th June 2007: £0.7billion). Our exposure to SIVs was £0.7billion comprising derivative exposures, un-drawn Commercial Paper backstop facilities and bonds held in our trading book (£0.9 billion at the end of June 30 2007). We have no further un-drawn backup liquidity facilities for SIVs or SIV-lites. Cumulative write downs on SIVs and SIV-lites to 31st October 2007 were £70 million.”

Asian markets fell across the region following declines in the U.S., falling dollar in the region, and expectations of interest rate hike in China.

Hong Kong led the decliners in the region with a loss of 1.4% on the expectations of rising interest rate in China. Chinese government officials have been sending signals that banks may be required to raise rates to curb rising food and consumer products prices. Hong Kong Stock Exchange rose after several brokers raised its rating on the exchange on higher trading volume.

Japan fell 0.7% on the worries that more losses may be declared by Japanese banks arising from sub-prime lending in the U.S.

Singapore fell 1.34% followed by losses in South Korea of 1.3%, in Shanghai of 1.2%, in Australia of 0.8%, and in Thailand of 0.7%.


6:30AM New York – 8:00PM Mumbai – Indian stock market turned cautious after surging to a record one-day rise in the previous session.

Sensex in Mumbai India dropped 144.17 or 0.7% to 19,784.89. CNX Nifty declined 25.80 or 0.43% to 5,912.10.

Of the stocks traded on the Bombay Stock Exchange, 1,808 advanced, 988 declined, and 46 were unchanged.

Trading volume on the exchange reached 9,233 crore rupees compared to 8,796 crore rupees a day ago. Daily turnover on the National Stock Exchange increased to 21,056 crore rupees from 20,726 crore rupees.

Bharti Airtel increased 4.7% to 900 rupees after the company asserted that the recent mobile number portability will not hurt the operating margins but may increased churn in the subscriber base. The telecom authority has allowed mobile subscriber to keep their telephone number even if they change their carrier.