[R]9:45AM U.S. stocks opened in the negative on rate concerns.[/R]

U.S. stock market opened lower on Thursday, reflecting rising yields in the bond market and mixed retail sales reports. The 10-year Treasury note's yield jumped over 5% in overnight trading, raising concerns that a rate cut later in the year is less probable. Mixed retail sales in May indicated that consumer spending was uncertain.

Retailers released reports on sale-store sales in May, showing a slight improvement compared to April’s generally weak sales. Wal-Mart (WMT: chart) lost 0.9% after it said its same-store sales came in slightly below estimates because of weakness in its apparel and home merchandise. J.C. Penney (JCP: chart) was a notable decliner, falling 4%, Macy's (M: chart) slipped 2%, and Abercrombie & Fitch (ANF: chart) lost 0.6% after reporting sales below estimate.

Costco Wholesale (COST: chart), Limited Brands (LTD: chart), and Jos. A. Bank Clothiers (JOBS: chart) moved higher on better-than-expected same-store sales. However, Nordstrom (JWN: chart) dropped 1.7% despite robust results. Saks Inc. (SKS: chart) jumped 5.1% after the luxury retailer posted stronger-than-expected sales.

In deal news, a group of investors including Blackstone Group launched an improved offer for Biomet (BMET: chart), lifting it to $11.4 billion, or $46 a share. In morning trading, the Dow Jones industrial average fell 12.92, or 0.10%to 13,452.75 a day after falling nearly 130 points. The Standard & Poor's 500 index fell 3.76, or 0.25%, to 1,513.62, and the Nasdaq composite index fell 4.51, or 0.17%, to 2,582.67.

Bonds fell sharply, with the yield on the benchmark 10-year Treasury note jumping to 5.04% from 4.97% late Wednesday.


[R]8:30AM Wal-Mart same-store sales in May disappointed.[/R]

Wal-Mart Stores Inc. (WMT: chart) said Thursday its May same-store sales rose 1.1%, excluding fuel. Including fuel, same-store sales advanced 1.3%, slightly below analyst expectations of an increase by 1.4%. Total U.S. sales for the four-week period rose 7.7% to $28.26 billion. The company expects June same-store sales to come between flat and 2%.

J.C. Penney Company Inc. (JCP: chart) reported 2% decline in its May same-store sales, missing the forecast for a rise of 0.3%. The retailer said total department store sales increased 0.3% to $1.2 billion. The company expects June same-store sales to fall in the low single-digit percentage range.

Costco Wholesale Corp., (COST)), warehouse retailer, reported 7% increase in same-store sales, exceeding expectations of a rise by 5.6%. Total sales in May rose 11% to $5.14 billion.

Limited Brands Inc. (LTD)) said its May sales at stores open at least one year rose 2%. Analysts, on average, had expected its same-store sales to fall 1.6%, according to Thomson Financial. Net sales for the four weeks ended June 2 rose to $774.7 million from $719.4 million


[R]8:00AM NY-7:00PM Mumbai Sensex loses 70 points on a sell-off in auto stocks.[/R]

The Sensex on BSE settled 69.75 points lower, or 0.49%, at 14,186.18.

The market-breadth was negative as there were almost three decliners for every two advancers. As 1,456 stocks declined, 1,043 stocks advanced and only 75 stocks were unchanged. Of the 30 stocks in the Sensex, only six advanced, while all the others declined. The turnover on BSE was Rs 4,269 crore, much lower than Rs 5,290 crore on Wednesday. On NSE, the turnover was Rs 9,093 crore, also lower than Rs 10,225 crore on Wednesday.

Economic news

The Secretary of the Department of Telecommunications, Mr. D S Mathur, said at a conference today that by the end of the current financial year there will be 30% more rural areas connected by mobile telecom service.

Mahindra Forgings Ltd is about to merge its three subsidiaries with the company in an effort to become the second-largest forgery in India. Mahindra Forgings would incorporate Mahindra Stokes Holding Company Ltd, Mahindra Forgings Overseas Ltd and Mahindra Forgings Mauritius Ltd into itself. The combined turnover of all the companies is assessed to be in the region of Rs 2,000 crore.

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