Johnson Matthey leads the advancers, 4.5% higher, after broker Citigroup lifted its rating on the stock from hold to buy. DSG International advanced 2.9% on change of chief executive, John Clare, who would retire in September and facilitate in this way a likely takeover of the company.

Scottish & Southern Energy gained 2% as the company posted an increase of 23.5% in full-year profit before tax and put forward a new programme to reward its customers for energy efficiency.

Mining stocks advanced, supported by a recovery in Chinese and higher metals price. Anglo America gained 3.7%, while BHP Billiton rose 1.3%.

Decliners

Vodafone ended its long rally, as the large-cap lost 0.3%. Shares of the company increased 18% in the last month. Kingfisher was another one of the few decliners on the market, shedding 3.2%, although the company posted a 6.7% rise in first-quarter same-store sales.

Credit Suisse lowered its rating on pizza group Northern Foods from neutral to underperform on Northern Foods’ full year results announced yesterday. Shares in Northern Foods lost 4.6%.


[R]9:00AM U.S. stock futures pointed modestly higher, reflecting mixed economic data.[/R]

U.S. stock futures were indicating a slightly higher opening on Thursday, reflecting merger activity and mixed economic data. The Commerce Department said that Q1 GDP advanced 0.6%, lower than the 1.3% projected in April and lower than analyst estimates of 0.8%. However, the Labor Department reported positive news, saying that the number of U.S. initial jobless claims dropped last week for the sixth time in seven weeks. On Wednesday, global markets suffered notable weakness, due to a sharp drop if Chinese stocks. However, the Shanghai Composite Index rebounded Thursday, rising 1.4%.

On the deal news front, banking company Wachovia (WB: chart) agreed to acquire A.G. Edwards (AGE: chart) for $6.8 billion in cash and stock. In another deal, payroll processor Ceridian (CEN: chart) said late Wednesday it will be bought out by investment firm Thomas H. Lee Partners LP and insurance provider Fidelity National Financial for about $5.3 billion.

Among pre-market highlights, discount retailer Costco Wholesale (COST: chart) posted Q3 profit drop of 4.9%, while jewelry seller Tiffany & Co. (TIF: chart) reported a 15% rise in Q1 profit, indicating that consumer demand for big-ticket items remains strong. Retailer Sears Holdings (SHLD: chart) reported 20% quarterly earnings increase, but said its U.S store sales decreased. Dow futures expiring in June rose 19, or 0.14%, to 13,675, after a strong 111-point gain Wednesday. Standard & Poor''s 500 index futures rose 2.80, or 0.18%, to 1,536.70. Nasdaq 100 index futures rose 5.50, or 0.29%, to 1,928.00.


[R]8:30AM Asian markets advance on Thursday with Shanghai, Tokyo and HK rebounding form earlier lows.[/R]

Asian markets finished higher on Thursday. The Shanghai Composite Index gained 1.4% to settle at 4,109.65. The market opened with a negative bias Thursday, but recovered in the afternoon. China Petroleum & Chemical and Shanghai Pudong Development Bank advanced to the daily 10% limit and Industrial & Commercial Bank of China rose 3%, while Aluminum Corp. of China surged 7.4%.

Japanese Nikkei 225 index advanced 1.6% to 17,875.75. Matsushita Electric Industrial Co ended 0.4% higher, bouncing back after declning in early trading. The company had announced Wednesday its plans to take back about 3 million microwave ovens, refrigerators and dryers because of a fire hazard. Nintendo also advanced 2.8%.

Hong Kong''s benchmark index rose 1.68% to end at 20,634.47. China Petroleum & Chemical Corp. rallied 9.7% in Hong Kong, while Australian benchmark S&P/ASX 200 finished 1.1% higher at 6,341.80. Investa Property Group gained 15.2% on reports that Morgan Stanley has struck a deal to buy the company for $3.9 billion in cash and debt. BHP Billiton aslo advanced 1.5%. South Korean benchmark index Kospi closed 2.3% higher at 1,700.91.


[R]8:15AM Wachovia agreed to acquire A.G.Edwards for $6.8 billion.[/R]
Wachovia Corp. (WB: chart) announced early Thursday it agreed to acquire A.G. Edwards Inc. (AGE: chart) in a cash-and-stock deal worth $6.8 billion to form one of the largest U.S. retail stock brokerages. The takeover bid values A.G. Edwards at $89.50 per share based on Wednesday''s closing prices, a 16% premium. A.G. Edwards shareholders will get 0.9844 Wachovia shares and $35.80 in cash for each A.G. Edwards share held.

The combined company will have more than 3,300 brokerage locations across the United States, more than $1.1 trillion in client assets and nearly 15,000 financial advisers. The deal is expected to close in the fourth quarter of 2007, whereas full integration of A.G. Edwards with Wachovia Securities is expected to be completed by early 2009.

Daniel J. Ludeman, president and chief executive of Wachovia Securities unit, will keep these positions at the combined brokerage unit, while A.G. Edwards Chairman and CEO Robert Bagby will be chairman of the brokerage.