U.S. MARKET AVERAGES

U.S. stock markets advanced at opening, strongly supported by a great amount of merger-and-acquisition news, robust earnings from FedEx, and upbeat third-quarter GDP data which eased inflation concerns. Each of the three major averages gained 0.5%.

The Commerce Department released a downward revision of GDP for the third quarter which showed that he U.S. economy grew at fastest pace in a year and a half. The third-quarter GDP rose at an annual rate of 4.1%, despite surging oil prices and hurricanes, following a 3.3% rise in Q2. Economists had been expecting a 4.3% increase in July –September industrial output.

Acquisitions in the technology and pharmaceutical industries promised to inject strength to lagging sectors. Google Inc., Seagate Technologies and IBM Corp. announced major purchases, while Allergan Inc. said it will buy Inamed Corp.

Allergan Inc. agreed to pay more than $3 billion for Inamed Corp., offering a deal that topped Medicis Pharmaceutical Corp.''s first bid.

Seagate Technology (STX: chart) offered $1.9 billion in shares for Maxtor Corp. (MXO: chart), a hard disk making rival, that values each share at a 60% premium to Tuesday''s close. This came after Google and Time Warner finally announced their AOL deal, with Google taking a $1 billion stake in the America Online unit.

Arden Realty Inc., a real estate investment trust valued at more than $3.1 billion, is near a deal to be bought by General Electric Co. and other investors.

The disk drive sector sharply rose in the early going, thanks to the $1.9 billion deal for Seagate to acquire Maxtor. Transportation stocks also advanced on strong earnings from FedEx. The Dow Jones Transportation Average rose more than 1.5%.

Very few sectors declined in early going with the semiconductor sector being the most notable loser among the laggards,despite showing only a slight decline.

In the first hour of trading, the Dow Jones industrial average rose 49.63, or 0.46%. The Standard & Poor''s 500 index climbed 4.99, or 0.4%, and the Nasdaq composite index gained 7.44, or 0.33%.

Bonds continued the previous session''s selloff, with the yield on the 10-year Treasury note rising to 4.49% from 4.47% late Tuesday.

MOVERS AND SHAKERS

Shipping company FedEx Corp reported second-quarter 33% jump in profit of $1.53 per share vs. $1.15 a year ago on 10% revenue growth, easily beating its own and Wall Street's expectations. The strong quarterly results are due to higher demand for its services and lower advertising costs. The stock rose 3.2%.

Family Dollar Stores (FDO: chart) reported Q1 profit of $51.4 million, or 32 cents a share, from $54.4 million, or 32 cents, a year ago, beating estimates of 31 cents a share. Earnings per share remained flat despite the decline in net income because there were fewer shares outstanding. Sales advanced to $1.51 billion from $1.38 billion in last year's first quarter. The discount retailer forecast Q2 earnings of 45 cents to 50 cents a share and full-year earnings at $1.30 to $1.39 a share. Company’s shares rose 3.8%.

GSI Group Inc (GSIG: chart), a supplier of precision motion components, lasers and laser systems said that it authorized a stock repurchase program of up to 1.5 million shares. GSI shares rose 2.9%.

Nike Inc. (NKE: chart) , footwear and apparel company, reported Q2 profit rise of 15%, or $1.14 a share, up from 97 cents in the year-ago period on 10% revenue growth, beating estimates by 11 cents a share, but the company also reported a sharp slowdown in orders scheduled for future delivery. The stock dropped 5.2%.

ECONOMIC NEWS

Wednesday morning, the Department of Commerce released its final report on third quarter gross domestic product, showing that GDP growth was downwardly revised. The downward revision came as a surprise to economists.

The report showed that third quarter GDP rose at an annual rate of 4.1 percent, down from the previous estimate of 4.3 percent, although still above the 3.3 percent growth seen in the second quarter. Economists had expected third quarter GDP growth to be unrevised.

The Commerce Dept. said that the lower than previously reported growth reflected a downward revision to consumer spending for durable goods as well as several other smaller downward revisions that were partly offset by an upward revision to exports of services.