U.S. MARKET AVERAGES

Market see-saw has become common for the last fifteen trading days and today was no different.

Seventy five retailers reported sales for the month of February largely disappointing investors. After warm month of January when sales were generally better-than-expected February month had weaker-than-expected sales. Department stores, discount retailers and large format stores exceeded lowered expectations but specialty retailers and teenage retailers did not meet analysts’ expectations. Analysts are not expecting a turnaround in sales trend in March either. Rising energy cost, declining home values and uneasiness for the job market may contribute in March weak sales forecast.

Talbots (TLB: chart), Abercrombie & Fitch (ANF: chart), Aeropostal (ARO: chart), Chico’s (CHS: chart), Dillard’s (DDS: chart) and Gap (GPS: chart) did not meet expectations. However, Gymboree (GYMB: chart), Children’s Place (PLCE: chart), Wal-Mart (WMT: chart), Costco (COST: chart) and Nordstrom met lowered expectations of the market.

Shares of Google gained 2.9% after losing 7.1% yesterday. Google while making presentation at company headquarter hinted that Microsoft is its chief rival and advertising revenue forms its core revenue. The company also is looking at one day to reach $100 billion in revenue from its current annual revenue of $6 billion.

Labor department reported weekly job claims, for the seventh week in a row, less than 300,000. Steady job market has still not managed to raise consumer confidence as evidenced in the earlier report this week.

President Bush on a historic trip to India and signed several agreements including cooperation in the areas of nuclear fuels, commitment to double bilateral trade every three years, and joint military exercises in the region. President Bush is the first Republican president to visit India in 35 years.


MOVERS AND SHAKERS

Versant Corp (VSNT: chart), database-management company, reported Q1 net income of 22 cents a share, compared with 10 cents in the year-earlier period. Revenue fell to $4.6 million from $5.3 million. The stock surged to 50%.

MatrixOne (MONE: chart) surged after France''s Dassault Systemes said that it was buying the business software company for $408 million, or $7.25 a share in cash. The bid represents a 21% premium to MatrixOne''s Wednesday closing price of $6.01. The stock climbed 19%.

PetSmart (PETM: chart) reported Q4 net income rise of 50 cents a share compared with a restated 43 cents in the year-earlier period. The company’s shares rose 10%.
said it did not make the March 1 interest payments on its 7% senior notes due March 1, 2029, and its 6.5% senior notes due March 1, 2009. The total amount of the interest payments was $21 million. The

Dana Corp (DCN: chart), auto-parts company, said it did not make the March 1 interest payments on its 7% senior notes due March 1, 2029, and its 6.5% senior notes due March 1, 2009. The total amount of the interest payments was $21 million. The company said there is a 30-day grace period on the interest payments. Failure to make the payments by March 31 would constitute a default. The stock plunged 31%.

Nastech Pharmaceutical (NSTK: chart) said it''s reacquiring the rights to PYY3-36, a nasal spray for the treatment of obesity, from its cooperation partner Merck & Co. and will advance its clinical development. Merck''s agreement with Nastech has expired and the drug giant said the nasal formulation has not shown itself to be effective in early testing. The stock plunged 36%.

ECONOMIC NEWS

The Department of Labor reported that the initial jobless claims in the week ended February 25 rose to 294,000 from the previous week''s revised figure of 279,000. Economists had expected jobless claims to rise to 285,000 compared to the 278,000 originally reported for the previous week.

Despite the increase, initial jobless claims remained below 300,000 for the seventh consecutive week. A reading consistently below 300,000 is said to indicate strength in the labor market.

The Labor Dept. also said that the four-week moving average rose to 287,250 from the previous week''s revised average of 282,000. The less volatile moving average has moved higher in two of out of the past three weeks after trending lower for the six weeks prior.

Additionally, the report showed that continuing claims fell to 2.486 million in the week ended February 18 from the preceding week''s revised level of 2.488 million.

While the bigger than expected increase in jobless claims may raise some concerns about next week''s February employment report, it may also help to ease investor worries that a tight labor market will lead to higher inflation and a continued increase in interest rates.