[R]9:00AM U.S. stock futures traded advanced on core inflation and retail data.[/R]
U.S. stock market futures were pushed higher on Friday by hopes for interest rate cuts, raised by flat core producer prices and lower retail sales. The Labor Department said that higher energy prices lifted wholesale prices by 0.7% in April, but core inflation was tame again. U.S. retail sales had their worst performance in 7 months, falling a worse-than-expected 0.2% in April. Market also digested the latest assessment from ex-Fed Reserve Chairman Alan Greenspan who reportedly said that the odds are two-to-one against a U.S. recession, buoyed by improving prospects around the world.

Among pre-market highlights, American International Group (AIG: chart) posted a 29% profit increase, as its property and casualty insurance business avoided big losses and after it maintained premium growth. Nvidia (NVDA: chart) rose 4.6% in pre-open trade on better-than-expected 44% profit rise on 24% revenue growth. Alcatel-Lucent (ALU: chart) rose nearly 3% after it posted Q1 profit decline and forecast higher Q2 sales. Credit Suisse upgraded the stock to outperform from neutral.

Of companies drivren by analyst comments, Amgen (AMGN: chart) dropped 2.8% following two downgrades. J.P. Morgan cut its rating on the stock to neutral from overweight. Citigroup downgraded Amgen to sell from hold. S&P 500 futures rose 3.7 points at 1,502.70 and Nasdaq 100 futures climbed 4.5 points at 1,891.00. Dow industrial futures rose 35 points.

[R]PPI rose 0.7% in April. Core inflation remained flat.[/R]
Friday morning, the Department of Labor released its closely watched report on wholesale prices in the month of April. The report showed that prices rose a little more than economists had expected, although core prices were unchanged. The Labor Department said that its producer price index rose 0.7 percent in April following a 1.0 percent increase in the previous month. The increase came in slightly above economist estimates of a 0.6 percent increase. The bigger than expected increase in prices was largely due to another significant increase in energy prices, which rose 3.4 percent in April after rising more than 3 percent in each of the two previous months.

Higher prices for gasoline, liquefied petroleum gas, home heating oil, residential electric power, residential natural gas, and diesel fuel contributed to the continued increase in energy prices. At the same time, the report showed a slowdown in the pace of growth in food prices, which rose 0.4 percent in April compared to a 1.4 percent increase in March. Prices for fresh and dry vegetables, beef and veal, and dairy products rose less than they had a month earlier. The report also showed that the core producer price index, which excludes food and energy prices, was unchanged for the second consecutive month. Economists had been expecting core prices to increase by 0.2 percent. The Labor Department added that wholesale prices rose at an annual rate of 3.2 percent in April. Core prices were up 1.5 percent year-over-year.


[R]8:30 AM Asian markets finished lower Friday with Japan ending down on export-oriented stocks.[/R]

Asian markets finished lower on Friday. The 225-issue Nikkei Average ended 1.3% lower at 17,553.72. Canon eased 2%, while Sony gave up 1.8%. Nikon dropped 2.3% after the company announced Thursday that its net profit increased to 54.82 billion yen in the fiscal year through March, nearly double that of the previous year. Konica Minolta shed 7.2% on profit-taking tracking recent share price advances and a brokerage downgrade from Mizuho Securities. Automakers bucked the downtrend, with Toyota Motor adding 1.4% while Nissan Motor gaining 1.1%.

Hong Kong Hang Seng Index ended 1.3% lower at 20,468.21. Mobile operator China Mobile declined 2% and in China, the Shanghai Composite Index closed down 0.7% at 4,021.67, easing from a record close in the previous session.

Australian S&P/ASX 200 closed down 0.9% at 6,297.40. Mining stocks were lower, pulled down by drops in natural-resource prices and increasing skepticism of an imminent takeover bid by BHP Billiton for Rio Tinto. Shares of BHP Billiton shed 2.9%, while Rio Tinto fell 1.4%.

Elsewhere around the region, South Korea bucked the trend and advanced. The benchmark index, Kospi, edged up 0.2% to close at 1,603.56. Taiwan leading index, the Weighted Price Index, ended down 0.8% at 8,031.54.


[R]8:00AM NY-7:00PM Mumbai Sensex ends higher in volatile trading. Bajaj Auto surges.[/R]

The Sensex on BSE finished 24.93 points, or 0.18%, higher at 13,796.16.

The session was extremely volatile as the index traded within a range of 301.23 points. The market-breadth ended almost even, as 1,268 stocks advanced while 1,276 declined and only 82 remained unchanged. Of the 30 stocks in the Sensex, 11 advanced, while the rest declined. The turnover on BSE was Rs 4,429 crore, slightly higher than Rs 4,304.80 crore on Thursday. On NSE, the turnover was Rs 9,404.94 crore, compared with Rs 9,225.37 crore on Thursday.

Economic news

Mayawati-led Bahujan Samaj Party has a great lead over the ruling Samajwadi Party and the Bharatiya Janata Party as the latest trends in the 403-member Uttar Pradesh assembly polls suggested. Out of 304 seat vote counting available at the state election headquarters, BSP was leading in 145 seats while the SP and BJP followed with 70 and 45, respectively. UP elections are keenly watched for voter preferences and indicator of national trend.

Wholesale inflation rate in India slowed for a second week as prices of fruits, vegetables and spices declined. The key wholesale price index was 5.66% in the week ended April 28, from 5.77% in the previous week. Analysts forecast inflation at 5.75%.

A government report showed that industrial production in India advanced 12.9% annually in March 2007, from a year earlier, higher than the annual growth of 10.8% in February on strong manufacturing output. Analysts had forecast annual industrial output growth of 10.40%.

Trading highlights