American Express Company, the biggest U.S. credit-card company by purchases and cash advances was raised to ``neutral'' from ``sell'' at UBS AG, saying share price reflects the ``weak'' economic outlook.

June auto sales are also on tap and both General Motors and Ford are expected to post big monthly declines. The June report could be the worst month for auto sales since 1992.

Morgan Stanley research report late Monday said the Lehman Brothers shares reflect potential woes despite more speculation that the investment bank is in trouble, including possibly having to sell itself.

Rio Tinto Plc, the mining company has won a 97% price increase for its iron ore from Asian customers this year.

June N. American-made car sales are at 5.0 Mln rate with 59% reporting; June N. American-made truck sales are at 5.1-Mln rate with 65% reporting. General Motors N.Amer-made US car sales at 109,224 June vs. 138,351 in year-ago period; General Motors N. Amer-made US light truck sales came out at 153,105 June vs. 182,317 in year-ago period.

The stock market continues to trade with significant losses. Only the defensive-oriented utilities sector (+0.3%) is showing a gain.
Though materials are sporting the largest loss (-2.8%), financials continue to trade considerably lower (-1.6%).
Legg Mason (-3.49) has had its debt ratings placed on review for possible downgrade at Moody's. The action follows Legg Mason's announcement that it will incur further losses in its ongoing support of many of its constant net asset value money market funds. Notably, Standard & Poor's has affirmed a BBB+ ratin on Legg Mason and lowered its outlook to negative from stable.

The dollar was little changed versus the euro after the U.S. Institute for Supply Management's factory index rose to 50.2 last month, from 49.6 in May. A reading of 50 is the dividing line between expansion and contraction. The median forecast of economists surveyed was for a drop to 48.5. The institute's employment index decreased to 43.7, from 45.5 in May.
``It does cause the market to be a little optimistic, but I would say such optimism is unwarranted,'' said Todd Elmer, currency strategist at Citigroup Global Markets in New York. ``The U.S. economy will remain weak for quite some time to come. The housing market has failed to stabilize. The soft employment component in the ISM number confirmed the continued deterioration in the labor market.''
The U.S. currency fell earlier as crude oil rose as much as 2.4 percent to $143.33 a barrel. The euro-dollar exchange rate and oil have moved in the same direction 90 percent of time during the past year, according to calculations based on the correlation of their value changes.
Former U.S. Treasury Secretary Robert Rubin said in an interview in Rome that economic difficulties will last ``quite some time.'' Billionaire investor Eli Broad, 75, the founder of Los Angeles-based homebuilder KB Home, said in an interview yesterday that the slowdown in the U.S. economy is ``worse than any recession we've had since World War II.''
Futures on the Chicago Board of Trade show a 20 percent chance the Fed will raise its 2 percent target rate for overnight lending between banks by a quarter-percentage point on Aug. 5, compared with 38 percent odds a week ago.
Economists predict the European Central Bank will increase its 4 percent main refinancing rate by a quarter-percentage point on July 3, the same day a U.S. government report will probably show nonfarm payrolls shrank by 60,000 workers last month, according to separate surveys

Stocks stabilized Tuesday morning as investors welcomed a surprise rise in a key manufacturing report and opted to scoop up financials and other issues battered in the recent selloff.
However, any advance on the first day of the third quarter was limited by a continued march higher in fuel prices.
Stocks had been weaker before the Institute for Supply Management said its manufacturing index rose to 50.2 in June. The forecast had been for the index to slide to 48.6, according to Briefing.com. A reading above 50 implies expansion, while one below implies a contraction in the sector.
A separate report showed a smaller-than-expected decline in construction spending in May.
The benign economic news helped temper some worries about the economy. Stocks also got support as investors looked to pick up recently-battered shares.
Stocks have been under pressure this year amid surging oil and gas prices and the continued fallout from the credit and housing market crises.
Lehman Brothers shares rose as investors mulled talk that the bank may need to put itself up for sale and at a discount, much like Bear Stearns.
Such concerns sent the stock plunging Monday, but Lehman bounced Tuesday after Morgan Stanley started coverage of the stock with an "outperform" rating.
UBS shares slipped after the company said it will reshuffle its board following big subprime mortgage losses.
General Motors continued to slide after hitting a 54-year low on Monday.
Ford Motor shares sank too. The automakers are expected to post steep June sales declines later in the day.
Auto sales have been hit by climbing gas prices. The national average price for a gallon of regular unleaded gas rose to a record $4.087 from a record $4.086 the previous day, according to AAA.
Oil jumps. U.S. light crude for August delivery rose $1.65 to $141.65 a barrel on the New York Mercantile Exchange. The front-month contract is close to the all-time trading record of $143.67 per barrel hit Monday.
In the bond market, Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.96% from 3.97% late Monday. Bond prices and yields move in opposite directions.

Steve Ricchiuto, Handelsbanken: "The national manufacturing index pushed back above its 50 boom/bust line for the first time since January rising to 50.2 for the month. The details of the release, however, were not as positive with all the new orders series moving lower and with the employment measure setting a new cycle low...The employment measure fell to 43.3 from 5.5 suggesting that labor market conditions continue to deteriorate which contrasts to the rebound in the headline series."

Dow sinks below market threshold to begin the year's second half on the same dour note as the first.
Stocks tumbled Tuesday morning, starting off the year's second half on a sour note, with the Dow falling into bear market territory amid higher fuel prices and more bank sector worries.
The Dow Jones industrial average lost 0.8%, a decline that set it at least 20% off its fall highs, the technical definition of a bear market.
The broader Standard & Poor's 500 index also declined, and is not far from bear market territory. The tech-heavy Nasdaq composite had fallen into bear market territory in March - dropping 24% off the highs - before recovering a bit off those lows.
Stocks struggled Monday at the end of the worst June for the Dow and S&P 500 since the Great Depression, ending a tough first half of the year on a down note. Year-to-date, the Dow is down 14.4%, the S&P 500 is down 12.8% and the Nasdaq is down 13.5%.
Stocks have been under pressure due to rocketing oil prices and ongoing financial market woes. Investors started off the second half of the year Tuesday with similar concerns amid falling global markets and ahead of some key U.S. economic reports, due shortly.
In the news:
Oil jumps. U.S. light crude for August delivery jumped $2.59 to $142.59 a barrel on the New York Mercantile Exchange, in a threat to the all-time trading record of $143.67 per barrel hit Monday.
Worst June since the 1930s. The Dow's plunge of 10.2% in June was the worst monthly performance since September 2002 when it fell 12.4%, and the worst June since 1930, when it sank 17.7%. The S&P 500's 8.6% decline was the worst month since September 2002, when it fell 11% and the worst June since 1930, when it fell 16.5%.
The Nasdaq fell 9.1% - the worst monthly performance since this past January - when it lost 9.9%, and the worst June since 2002, when it shed 9.4%

The stock market has made its way into the green. Before the breakthrough, participants had been selling into strength as the stock market was repeatedly rebuffed at the neutral line.
Sentiment is less dour than earlier in the session; six of the economic sectors are trading with gains and decliners in the S&P 500 outnumber advancers by 3-to-2.
Utilities (+0.6%), favored for their defensive characteristics, are currently the best performing sector.

Ryan Wang of HSBC notes that the drop in the employment
component of ISM (43.7 in June vs 45.5 in May) adds to "the negative
signals for Friday's non-farm payrolls." HSBC looks for June payrolls to
fall by 100,000. The median estimate in a Survey of Economists looks for payrolls to fall by 65,000. Estimates
range from -130,000 to -15,000.

Stocks are spiking higher after receiving a batch of fresh economic data.The ISM Index for June was reported at 50.2, topping the 48.5 reading that was widely expected. The reading for May was unrevised at 49.6. ISM Prices Paid was reported at 91.5. Economists were expecting a reading of 87.0.
May construction spending fell 0.4% month-over-month. Economists forecast a 0.6% downturn. Sequential growth in the prior month was revised upward to a 0.1% decline.

EUR/USD $1.5785, $1.5700
USD/JPY Y106.30, Y105.45, Y105.10, Y108.00
GBP/USD $2.0000
EUR/JPY Y168.15
NZD/USD $0.7650AUD/USD $0.9700, $0.9525
USD/CAD C$1.0000

Stocks remain on track for a downward open (S&P futures -13.6, Nasdaq futures -21.0).
Shares of Lehman Brothers and Goldman Sachs were initiated with an Overweight rating at Morgan Stanley.
Stocks indicate a sharply lower start as traders continue to focus on escalating oil prices and news from the financial sector. Oil is up to more than $142 per barrel in early electronic trading. Merrill Lynch could sell key assets.

Corrective pullback extends, but again seen meeting demand on dips toward $1.9950. Bids seen placed to $1.9940, more between $1.9910/00 ahead of stronger area toward $1.9880. Offers remain in palce to $2.0010, with more reports coming in suggesting that level holds option barrier interest.

The dollar may extend losses against main rivals before government data this week that may show U.S. manufacturing shrank and employers cut jobs for a sixth month.
``The dollar has downside risks with upcoming manufacturing data,'' said Masaki Fukui, a senior economist and currency analyst in Tokyo at Mizuho Corporate Bank Ltd., a unit of Japan's second-largest publicly traded financial group. ``With the U.S. economy slowing, we do not expect any rate hike this year.''
The dollar may fall to 98 yen by year-end, Fukui forecast.
The U.S. Institute for Supply Management's factory index fell to 48.5 in June, from 49.6 in May. A reading below 50 indicates contraction.
The yen rose against the euro and dollar as stock losses and concern global economic growth is slowing eroded demand for higher-yielding assets funded in Japan.
The yen also gained against the dollar and euro as the Bank of Japan's quarterly Tankan survey showed business confidence among large manufacturers fell less than economists estimated.

EUR/USD: traded within $1.5725/75 range before under general US dollar pressure tested $1.5815/20. Offers $1.5840, bids $1.5720.
GBP/USD: got support at $1.9885/90 before Weak UK manufacturing PMI knocked cable back to $1.9950 where it met willing buyers, lifting it to $2.0000.
USD/JPY: due to carry trades reduction and general US dollar pressure fell from Y106.40 reached Y105.30.

Xetra-DAX is now down 154pts, CAC-40 down 115pts and FTSE-100 is down 159pts.

Reported offers, suggested to be option linked, between $2.0000/10 continue to keep upside pressure at bay, with traders highlighting the 61.8% retracement level at $2.0003 ($2.0399 Mar14/$1.9361 May14) so far able to cap the latest rise. Stops above $2.0010, which if triggered seen opening a move on toward $2.0030, with offers noted here, stronger between $2.0040/50.

The dollar may extend losses against main rivals before government data this week that may show U.S. manufacturing shrank and employers cut jobs for a sixth month.
``The dollar has downside risks with upcoming manufacturing data,'' said Masaki Fukui, a senior economist and currency analyst in Tokyo at Mizuho Corporate Bank Ltd., a unit of Japan's second-largest publicly traded financial group. ``With the U.S. economy slowing, we do not expect any rate hike this year.''
The dollar may fall to 98 yen by year-end, Fukui forecast.
The U.S. Institute for Supply Management's factory index fell to 48.5 in June, from 49.6 in May. A reading below 50 indicates contraction.
The yen rose against the euro and dollar as stock losses and concern global economic growth is slowing eroded demand for higher-yielding assets funded in Japan.
The yen also gained against the dollar and euro as the Bank of Japan's quarterly Tankan survey showed business confidence among large manufacturers fell less than economists estimated.
The Tankan index of manufacturer sentiment slid to 5 points in June from 11 points in March, a third quarterly decline, the report showed. The median estimate of 32 economists surveyed by Bloomberg was a drop to 3 points.
``We saw some gains in the yen as the Tankan data support the view that the Japanese economy is doing better than the U.S.,'' said Takuma Kurosawa, global markets treasurer in Tokyo at HSBC Bank, a unit of Europe's biggest lender. ``It's premature to say this will have an impact on the Bank of Japan's thinking on monetary policy.''

Financial stocks leading the charge lower, amid speculation of further writedowns. Airline and travel stocks are also lower on back of recent rise in crude oil prices, which hit fresh record high at $143.67 on Monday. Elsewhere, Xetra-DAX isoutperforming on back of stronger than expected German retail sales data this morning, which rose +2.6% m/m. -0.3% y/y in May. However, Deutsche Bank is a notable loser on market talk of further writedowns. CAC-40 is down 67pts (-1.50%), Xetra-DAX is 68pts (-1.06%) and FTSE-100 is down 105pts (-1.88%).

Resistance 3: Y108.40
Resistance 2: Y107.20
Resistance 1: Y106.50
Current price: Y105.56
Support 1: Y105.00
Support 2: Y104.50
Support 3: Y103.80

Comments: Below Y105.00, support is around Y104.50. Lower correction may reach Y103.80. Above Y106.50 and Y107.20 resistance comes at yesterday's peak of Y108.20. Rise above may extend Y108.50/60.

Resistance 3: Chf1.0350

Resistance 2: Chf1.0300
Resistance 1: Chf1.0220
Current price: Chf1.0182
Support 1: Chf1.0130
Support 2: Chf1.0020
Support 3: Chf0.9950

Comments: The nearest support at today's Chf1.0130 (50% Chf0.9650-Chf1.0620) and Chf1.0020 (61.8% Chf0.9650-Chf1.0620).Resistance comes at former support around Chf1.0220, break above to open a way to Chf1.0350. Further level comes on Chf1.0430.

Resistance 3: $2.0190
Resistance 2: $2.0020
Resistance 1: $2.000
Current price: $1.9975
Support 1: $1.9800
Support 2: $1.9660
Support 3: $1.9580


Comments: The pare retains positive mood and trades near resistance spotted at $1.9995/00 (upper bound of the rising channel since June 13). A break above the latter level to open the way for a test of $2.0000/20 area. The nearest support is $1.9800 (50% of the resent rally). A break under will open the way to $1.9670/60 (June 25 low) and Monday low at $1.9580.

Resistance 3:$1.5900
Resistance 2: $1.5840
Resistance 1: $1.5780
Current price: $1.5776
Support 1: $1.5720
Support 2: $1.5630
Support 3: $1.5460

Comments: The nearest resistance comes at $1.5780, then – at June highs $1.5830/40. Stronger level is around $1.5900. The closest supports are $1.5720 and $1.5630. The stronger one comes at on $1.5540 with a break under will open the way to $1.5460 (last week low).

DIW raised its forecast for 2008 German GDP to +2.7% from a previous projection of 2.0% made in April, while lowering its 2009 growth forecast to 1.2% from 1.6%. However, the anticipated slowing of annual average growth in 2009 is exaggerated by the exceptionally strong growth rate in the first quarter of 2008, DIW said.

The yen rose against the euro and dollar after Australia's central bank said it expects economic growth to slow, eroding demand for higher-yielding assets funded in Japan.
Japan's currency advanced the most against the Australian and New Zealand dollars as speculation UBS AG is likely to incur further asset writedowns in the second quarter reduced demand for so-called carry trades. The dollar traded near a three-week low against the euro on speculation an industry report today will show U.S. manufacturing shrank, adding to pressure on the Federal Reverse to delay raising interest rates.

EUR/USD: traded within $1.5725/75 range.
GBP/USD: got support at $1.9885/90 before reached $1.9995.
USD/JPY: due to carry trades reduction and general US dollar pressure fell from Y106.40 reached Y105.50.

European June manufacturing PMI, including Germany at 0730GMT (expected 52.3) and the main Eurozone number at 0800GMT (expected to drop to 49.1). The Eurozone May unemployment rate is due at 0900GMT and is expected to edge up to 7.2%.

Drops back to $1.9970, from around $1.9990, as rate extends its corrective pullback from recent highs of $1.9997 as UK manufacturing PMI data comes in under the expected forecast level (45.8, lowest since Dec 2001). Bids seen in place toward $1.9950.

FTSE down 5, the DAX down 10, the CAC down 10 and the Eurostoxx 50 down 5.

- June s/adj unemployment rate 7.8% vs 7.9% in May

"The data (industrial orders) is likely to reinforce the ECB's belief that the euro zone's economy is fundamentally sound and that it can press ahead with raising its key interest rate from 4 percent to 4.25 percent at its 3 July meeting to try to ensure that current elevated inflationary levels and pressures are not sustained over the medium term."

The S&P Sep contract was last ahead by 1.90 points at 1283.00, with the Nasdaq Sept contract up 4.0 points at 1850.0.

Resistance 3: Y108.40
Resistance 2: Y107.20
Resistance 1: Y106.50
Current price: Y105.89
Support 1: Y105.00
Support 2: Y104.50
Support 3: Y103.80
Comments: Below Y105.00, support is around Y104.50. Lower correction may reach Y103.80. Above Y106.50 and Y107.20 resistance comes at yesterday's peak of Y108.20. Rise above may extend Y108.50/60.

Resistance 3: Chf1.0350
Resistance 2: Chf1.0300
Resistance 1: Chf1.0220
Current price: Chf1.0207
Support 1: Chf1.0150
Support 2: Chf1.0050
Support 3: Chf0.9950

Comments: The nearest support at уs yesterday's lows Chf1.0160/50. Lower comes Chf1.0130 (50% Chf0.9650-Chf1.0620) and Chf1.0050.Resistance comes at former support around Chf1.0220, break above to open a way to Chf1.0350. Further level comes on Chf1.0430.

The benchmark Nikkei 225 was lower by 18.10 points, or 0.13%, at 13463.20. The broader-based TOPIX was down 0.03 points at 1320.07.

Resistance 3: $2.0190

Resistance 2: $2.0020

Resistance 1: $1.9950
Current price: $1.9937
Support 1: $1.9800
Support 2: $1.9660

Support 3: $1.9580

Comments: cable posted serious gains. The pare retains positive mood and trades near resistance spotted at $1.9950 (upper bound of the rising channel since June 13). A break above the latter level to open the way for a test of $2.0000/20 area. The nearest support is $1.9800 (50% of the resent rally). A break under will open the way to $1.9670/60 (June 25 low) and Monday low at $1.9580.

On the year, sales rose 0.7%.

--Nationwide: UK June House Prices Down 0.9% m/m; Down 6.3% y/y
--Nationwide: Largest Yearly House Price Fall Since Dec 1992
--Nationwide: Q2 House Prices Down 3.4% q/q; Down 4.0% y/y

Resistance 3:$1.5900

Resistance 2: $1.5840
Resistance 1: $1.5820
Current price: $1.5760
Support 1: $1.5720
Support 2: $1.5650
Support 3: $1.5460

Comments: The nearest resistance comes at $1.5820, then – at June highs $1.5840. Stronger level is around $1.5900. The closest supports are $1.5720 and $1.5630. The stronger one comes at on $1.5540 with a break under will open the way to $1.5460 (last week low).

The front-month Nymex WTI Aug '08 contract was last up 50 cents at $140.50, just shy of the session high at $140.65.

High Low Close
EUR/USD 1.5833 1.5730 1.5752
USD/JPY 106.43 104.99 106.07
GBP/USD 1.98966 1.9879 1.9933
USD/CHF 1.0215 1.0129 1.0207

EUR/JPY 168.04 166.07 167.10
EUR/GBP 0.7935 0.7893 0.7899
GBP/JPY 212.30 209.42 211.46
GBP/CHF 2.0350 2.0209 2.0348


Change % Change Last
Nikkei 225 -62.98 -0.46% 13,481.38
Topix -0.58 -0.1% 1,320.10
DAX 30 -41.28 -0.64% 6,418.32
САС 40 +37.53 +0.85% 4,434.85
FTSE +96.00 +1.74% 5,625.90
Dow +3.50 +0.03% 11,350.01
Nasdaq -22.65 -0.98% 2,292.98
S&P +1.62 +0.13% 1,280.00
10yr Note -0.1100 -0.028% 3.979%
OIL NYMEX -0.21 -0.15% 140.00
Gold -3.00 -0.32% 928.30

04:30 Australia RBA meeting announcement - 7.25%
06:00 UK Nationwide house price index (June) -1.0% -2.5%
06:00 UK Nationwide house price index (June) Y/Y -6.3% -4.4%
07:45 Italy PMI (June) - 48.0
07:50 France PMI (June) 49.2 51.5
07:55 Germany PMI (June) seasonally adjusted 52.3 53.6
07:55 Germany Unemployment (June) seasonally adjusted -15K +4K
07:55 Germany Unemployment (June) seasonally adjusted, mln - 3.310
07:55 Germany Unemployment rate (June) seasonally adjusted 7.9% 7.9%
07:55 Germany Unemployment (June) seasonally unadjusted, mln - 3.283
07:55 Germany Unemployment rate (June) seasonally unadjusted - 7.8%
08:00 EU(15) PMI (June) 49.1 50.6
08:30 UK CIPS manufacturing index (June) 49.8 50.0
09:00 EU(15) Unemployment (May) 7.2% 7.1%
12:55 USA Redbook (28.06)
14:00 USA ISM Mfg business index (June) 49.6 49.6
14:00 USA Construction spending (May) -0.5% -0.4%
Canada National Day