[R]4:00PM NY, 10:00 PM Frankfurt, 1:30AM Mumbai – Global Markets[/R]

Yields edged higher on 10-year U.S. bonds and closed at 5.10% and 30-year bond rose to close at 5.224%.

Crude oil down $1.41 to close at $67.77 per barrel, natural gas down 6 cent to close at $6.88 per mBtu, and gasoline futures fell 5.56 cents to close at 224.69 cents per gallon.

Gold lost $9.40 to close at $645.30 per ounce, silver lost 60 cents to close at $12.40 per ounce, and copper futures lost $46 to close at $7,529 per metric ton.

In New York trading, three widely followed averages fell on two buyout deals worth $9 billion, falling crude oil prices, continued housing market and Bear Stearns controlled hedge fund related worries. The Commerce Department reported that May month new home sales fell 1.6% from April and 15.6% from a year ago and home prices fell 2.1% from a year ago.

Lennar (LEN: chart) dropped 3% after the company reported second quarter loss, first second quarter loss in more than ten years. The company reported loss of $1.55 per share. Kroger (KR: chart) fell $2 or 7% after reporting lower than expected earnings and fierce competition from Wal-Mart.

Blackstone (BX: chart) on the third day of its trading fell 5% below its offer price of $31. Largest private equity group Blackstone Group priced its IPO at $31 per share and raised $4.6 billion and saw its stock jump 13% at the end of first day of trading on Friday.

Latin Markets fell across the region led by 1.8% loss in Mexico, 0.7% in Chile, 0.3% in Brazil and Argentina.

In Mexico City trading, IPC Index fell 1.8% for the third day after the Central Bank decided to leave the interest rates unchanged to 7.25%. The Mexican market suffered along with other emerging markets on the worries that rising bond yields in the U.S. will slow fund flows from the developed markets. American Movil, Homex and Cemex fell more than 2%, Telmex, and Coca Cola Femsa lost 1%.

In Sao Paulo trading, Bovespa dropped 0.3% on worries that rising yields in the U.S. will hurt investment flows to the country. Petrobras, Tam Air, Bradesco and Itau fell close to 1% in trading. National Monetary Council extended its inflation target to 4.5% till the year 2009 with a band of 2%.

European markets closed lower across the region on profit taking in mining, banks and insurance stocks and worries related to rising rates. A decline of 1.1% in Italy led the region followed by 0.9% fall in Germany, France and the Netherlands. Spain and Switzerland fell 0.7% and U.K. dropped 0.4%.

In Frankfurt trading, DAX Index fell 0.9%, fourth decline in a row, on the worries that interest rate hike may slow down the economic growth. Hypo Real Estate fell 1.1% and Deutsche Bank dropped 1.1%, Henkel KGaA dropped 4.4% on the news that Deutshce Bank will sell 6% of its preferred stock or 11.2 million shares.

In London trading, FTSE Index fell 0.4%. British pound traded at elevated levels and crossed $2 barrier against dollar ahead of the central bank governor testimony. Barclays fell 1.3% and Royal Bank of Scotland dropped 0.2% after reports that the Dutch Supreme Court is likely to permit the sale of Chicago unit LaSalle Bank to Bank of America. BAE Systems fell 8% after the company said that it is a target of U.S. Justice Department in alleged corruption inquiry. Independent energy company Dana Petroleum slumped 6% on a company plan to offer 150 million pounds of senior convertible bonds.

Asian Markets fell for the third day after indexes retreated from record levels. Shanghai rebounded with a gain of 0.9%. Singapore declined with a loss of 1.5% followed by 0.8% decline in Taiwan and 0.7% fall in Malaysia. Japan and Hong Kong lost 0.1% and Australia fell 0.3%. Regional news and money flows issues dominated trading sentiment.

In Tokyo trading, banks, exporters and trading companies fell the most. Sub-prime lending issues in the U.S. worried traders that Japanese exports may be hit. Komatsu dropped 1.7%, Sony and Nissan lost 0.9%. Mitsui Fudosan recovered 1.5% after losing 7% in the previous week as real estate stocks staged a recovery. Mitsubishi Estate rebounded 0.9%. Asahi Glass jumped 2% on the local news that the company is looking to build a second glass substrates manufacturing plant in Korea. Trading companies Mitsubishi fell 2.4% and Mitsui decreased 2%.

In Shanghai trading, CSI Index rebounded 0.9% after falling for three days in a row. Public offering of China Coso worth $2 billion was oversubscribed 100 times. The stock soared 93% on its first day of trading in Shanghai. A total of $13.5 billion stock offering are expected to be priced in China IPO market in the next six months including offerings from PetroChina, China Construction Bank and Anhui Conch Cement.

In Hong Kong trading, Hang Sang Index lost 0.1%. The index had gained 7% steadily in the last week of trading. Lenovo fell 6% on downgrade from Deutsche Bank. Casino billionaire Stanley Ho has agreed to purchase 75% stake in a property project in Macau controlled by Gordon Wu for HK 6.8 billion.

In Mumbai trading, Sensex Index gained 0.1%. State Bank of India said that it may have to raise $12 billion in the next three years to meet rising loan demands and meet capital requirements to meet Basel Standard. ONGC gained 2% after declaring annual profit gain of 10% and Bharti Airtel rose 2% on HSBC Bank target price revision by 9%.

[R]1:00PM NY, 5:00 PM Frankfurt European markets closed down, dragged by rate worries. A sharp decline in BAE Systems shares weighed[/R]

European stock markets finished in the red on Tuesday, weighed down by continuous worries over interest rates and the subprime-mortgage market. In addition, a steep decline was posted by shares of BAE Systems, falling 7.8% after a U.S. anti-corruption probe into Britain's top arms dealer.