US Markets - Wall Street closed out a bumpy week with a moderate advance Friday as tech stocks charged higher on takeover news and other sectors gained on data that indicated the economy is expanding at a healthy pace. The major indexes managed to post gains for the week.

Oracle Corp.'s bid for BEA Systems Inc. helped prop up technology stocks, and gave investors renewed hope that acquisition activity is picking up again after the uncertainty of the summer's credit crisis. Corporate news also boosted some blue chip names: McDonald's Corp. posted higher-than-expected sales and General Motors Corp. said sales in its Latin America, Africa and Middle East region jumped in the third quarter.

Amid the economic data Wall Street mined Friday for signals about the health of the economy, the government reported that retail sales showed a stronger-than-expected gain last month and that wholesale prices jumped in September amid an increase in food and energy costs. Business inventories increased, while consumer sentiment slipped.

The Dow Jones industrial average rose 77.96, or 0.56%, to 14,093.08.

Broader stock indicators also advanced. The Standard & Poor's 500 index rose 7.39, or 0.48%, to 1,561.80. The tech-dominated Nasdaq composite index rose 33.48, or 1.21%, to 2,805.68.

The advance came after both the Dow and S&P fell two straight days as investors worried about third-quarter earnings season, and what companies might say about the economy. Investors were disappointed by reports from Alcoa Inc. and General Electric Co.and warnings from names like Chevron Corp. and International Paper Co.

But stocks were kept afloat during the week by the release of minutes from the Federal Reserve's Sept. 18 meeting. Investors interpreted comments from Fed governors as being receptive to a rate cut.

For the week, the Dow was up 0.19%; the S&P 500 rose 0.27% and the Nasdaq gained 0.91%.

Bonds were slightly lower Friday as fixed-income investors held their positions ahead of the weekend. The yield on the benchmark 10-year Treasury note, which moves inversely to the price, was up at 4.68% from 4.66% late Thursday.

Economic readings appeared to give a boost to stocks. The Commerce Department reported that retail sales rose 0.6% in September from August was double the growth economists had been expecting. The report came a day after many national retailers reported seeing sluggish demand in September.

The Labor Department said wholesale prices rose 1.1% in September. Excluding the often volatile categories of food and energy, wholesale prices edged up by a moderate 0.1%.

Inventories held by businesses on shelves and backlots rose 0.1% in August, less than the 0.3% gain analysts had been expecting.

Consumer sentiment fell in October, according to the Reuters/University of Michigan consumer sentiment reading for mid-October.

Oracle, the business software maker, confirmed it offered to buy BEA Systems for more than $6.66 billion. Oracle said it sent a letter to the software maker's board offering $17 per share, a 25% premium over Thursday's closing price of $13.62. BEA surged $5.20, or 38%, to $18.82, while Oracle fell 2 cents to $22.44.

In other corporate news, McDonald's said its global same-store sales -- or sales at stores open at least a year -- rose a stronger-than-expected 5.9% in September. The nation's No. 1 hamburger chain also forecast earnings for the quarter well ahead of Wall Street expectations. McDonald's rose 77 cents to $57.02.

GM rose $2.65, or 6.6%, to $42.64 after posting a 22% increase in sales in regions such as Latin America. The move comes after shares of the automaker jumped Thursday following a decision by union members to ratify a new contract with the automaker.

GE's third-quarter earnings rose 14% as its energy and transportation businesses did well. Many investors regard GE as a bellwether for the US economy because of the conglomerate's array of businesses -- from finance to engines to NBC Universal. GE fell 57 cents to $41.03.

Advancing issues outnumbered decliners by about 2 to 1 on the New York Stock Exchange, where consolidated volume came to 2.71 billion shares, compared to 3.82 billion on Thursday.

The Russell 2000 index of smaller companies rose 6.19, or 0.74%, to 841.17.

The Dow Jones industrial average ended the week up 27.07, or 0.19%, at 14,093.08. The Standard & Poor's 500 index finished up 4.21, or 0.27%, at 1,561.80. The Nasdaq composite index ended up 25.36, or 0.91%, at 2,805.68.

The Russell 2000 index finished the week down 3.71, or 0.44%, at 841.17.

The Dow Jones Wilshire 5000 Composite Index -- a free-float weighted index that measures 5,000 US based companies -- ended Friday at 15,789.30, up 65.61, or 0.42%, for the week. A year ago, the index was at 13,657.60.

European Markets - Leading European shares ended slightly higher to cap a positive week for the market as merger and acquisition talk drove gains and the telecom sector outperformed, helped by an upbeat outlook from Spain's Telefonica.

The Dow Jones STOXX 50 rose 9.59 points, or 0.2%, to an unofficial close of 3,932.44 while the STOXX 600 edged up 0.20 point or 0.05% to 390.63.

On the week, the STOXX 50 rose about 0.7% while the STOXX 600 gained 1%.

So let's start in France where in Paris Share prices closed lower amid profit-taking, but were above their lows for the day as losses were trimmed by optimism about the US economy that spurred Wall Street to post modest gains.

The CAC-40 index finished down 18.88 points, or 0.32%, at 5,843.95.

Among CAC-40 stocks, 28 closed lower and 12 closed higher.

On the broader indices, the SBF-80 index closed down 19.23 points, or 0.27%, at 7,045.02, and the SBF-120 index finished down 13.47 points, or 0.31%, at 4,264.52.

The profit-taking that marked the session prior to the US opening was a follow-through from similar activity on Asian markets, and for much of the day the CAC-40 was down more than 1%.

Glass and building materials company Saint-Gobain closed down 2.32 Eur, or 3.10%, at 72.60, the largest loss among CAC-40 shares, as Credit Suisse cut the stock to 'neutral' from 'outperform' and lowered its target price to 80 Eur from 100 Eur.

The negative sentiment weighed on the entire construction sector, with Vinci dropping 1.41 Eur or 2.57% to close at 53.56, and Lafarge closing 1.32 Eur or 1.11% lower at 117.61.

IT stocks that had posted recent gains amid market rumours of a further consolidation in the sector were initially among the day's largest losers, but recovered to close mixed. Capgemini ended up 0.18 Eur, or 0.37%, at 48.29, STMicroelectronics fell 0.06 Eur, or 0.51%, at 11.82 and Atos Origin dropped 0.51 Eur, or 1.14%, to close at 44.39.

Business Objects closed down 1.18 Eur, or 0.43%, at 41.62 after posting early gains of close to 3% amid hopes of a 45 Eur counter-bid from Oracle.

News that the US group is in fact eyeing BEA Systems triggered the downturn in Business Objects shortly after midday. Oracle submitted a 17 usd per share proposal for BEA Systems.

Gainers included EADS, which closed up 0.62 Eur, or 2.68%, at 23.77, after JP Morgan raised its target to 28 Eur from 26 Eur and added the group to its analyst focus list, saying the recent pick-up in orders is likely to prompt a change in sentiment.

JP Morgan analysts expect additional customer announcements in coming months and cited the potential for a public relations push until year-end.

The note served to bolster existing positive sentiment, generated by news yesterday of a major order for 73 Airbus aircraft from Spain's Grupo Marsans.

Utilities were also in favour, as investors sought out defensive stocks amid ongoing uncertainties over the sustainability of the equity rally.

Suez closed up 0.70 Eur, or 1.67%, at 42.55, and would-be merger partner Gaz de France finished up 0.54 Eur, or 1.45%, at 37.84. Veolia Environnement ended up 0.86 Eur, or 1.39%, at 62.60, while EDF closed up 0.30 Eur, or 0.39%, at 77.52.

Positive notes from major brokers also lent support to the utilities. Cheuvreux raised Suez to its 'selected list' from 'outperform', saying the group sports solid fundamentals and an attractive valuation as it trades at an 11% discount to its peers.

JP Morgan upped its price target for Veolia Environnement to 73 Eur from 67 Eur previously and reiterated its 'overweight' stance, saying the stock is trading at an 'unnecessary' discount to its sector.

To Frankfurt now where German shares closed slightly higher, turning into positive territory in late deals.

The DAX closed up 7.57 points, or 0.09%, at 8,041.26, reaching its highest level of the day after it fell to 7,974.87 earlier in today's session.

The MDAX retreated 1.41 points, or 0.01%, to 10,755.09, while the TecDAX gained 0.77 points, or 0.08%, at 1,014.67.

DAX futures were up 49.50 points, or 0.61%, at 8,101.50, while bund futures lost 0.42, or 0.37%, to 111.78.

Commerzbank led blue chips higher, adding 0.66 Eur or 2.16% to 31.25, as dealers pointed to vague rumours of a possible merger or that it might be the takeover target of Italian peer Intesa SanPaolo.

Deutsche Post followed, rising 0.39 Eur or 1.80% to 22.06.

Bayer gained 0.94 Eur or 1.66% to 57.66 after the company said its Betaferon multiple sclerosis (MS) treatment was shown to be effective in a study, in which it was given shortly after patients suffered the first attack on their nervous system from the debilitating disease.

SAP added 0.57 Eur, or 1.46%, to 39.51, with traders pointing to a Oracle Corp's confirmation that it has offered 17 usd per share in cash to take over peer BEA Systems Inc.

Henkel rose 0.33 Eur or 0.91% to 36.47.

Lufthansa was the largest decliner, dropping 0.47 Eur or 2.16% to 21.25, as it corrected from a two-day long upward push after the airline released strong September passenger data on Wednesday.

Infineon lost 0.19, or 1.71%, to 10.90, tracking a general weakness in US chip and semiconductor companies on Wall Street yesterday, which dealers attributed to a fall in the SOX industry index and an announcement from industry giant Samsung Corp that it expects DRAM chip prices to remain under pressure for longer that earlier expected.

MAN was down 1.44 Eur, or 1.19%, at 119.85 as speculation once again waned of a possible tie-up with Scania and Volkswagen.

Fresenius Medical Care declined 0.31 Eur or 0.86% to 35.83, while BMW lost 0.40 Eur, or 0.84%, to 47.23.

Over on the MDAX, IVG rose to the top, adding 0.91 Eur or 3.25% to 28.93, while AWD lost 1.16 Eur or 4.64% to 23.84 at the other end.

TecDAX-listed Wirecard gained 0.99 Eur or 9.07% to 11.91 following Morgan Stanley's initiation of the online payments processor with an 'overweight' rating and a 14.3 Eur per share target price.

Meanwhile, QSC declined 0.22 Eur or 5.79% to 3.58.

Into Belgium now where in Brussels Shares were lower at the close, with pharmaceutical group UCB leading the fallers after Deutsche Bank's research department cut its rating on the company to 'hold' from 'buy', and lowered its target price to 50 Eur from 54 citing potential near-term downside risks.

The Bel 20 closed 2.85 points or 0.06% lower at 4,532.06.

UCB was down 1.00 Eur or 2.46% at 39.69.

Discount supermarket chain Colruyt dropped 2.61 Eur or 1.76% to 146.04 after Dutch brokerage Petercam cut its stance on the group to 'hold' from 'buy' and reduced its twelve-month target price to 166 Eur from 190 on worsening market conditions.

Brewer Inbev was down 1.02 Eur or 1.52% at 65.95 and specialty materials group Umicore fell 2.66 Eur or 1.49% to 176.25.

For the heavyweight financials, KBC lost 0.61 Eur or 0.61% to 99.83, whilst Fortis edged 0.06 Eur or 0.25% lower to 23.49.

Peer Dexia gained 0.30 Eur or 1.31% to 23.22.

In positive territory, Suez rose 0.58 Eur or 1.38% to 42.51.

Telecoms groups Mobistar and Belgacom also ended higher, with the former gaining 0.81 Eur or 1.31% to 62.77 and the latter up 0.26 Eur or 0.78% at 33.50.

Outside the Bel 20, Cinema operator Kinepolis was down 0.33 Eur or 0.71% ar 46.17

After the market close, the group said it posted a 4.4% year-on-year rise to 5.8  Million from 5.5  Million in third-quarter ticket sales, with popular films boosting figures for July and August, but moderate ticket sales in September.

Healthcare distributor Arseus was down 0.08 Eur or 0.79% at 10.00.

Rabo Securities initiated coverage of the group with a 'buy' rating and 12.00 Eur target price, saying the group is well positioned to become a leading pan-European distributor of products and services to the growing healthcare industry, both organically as well as through acquisitions.

Innogenetics was up 0.41 Eur or 6.79% at the close, following news yesterday that the biotech group signed a license agreement with German peer AdnaGen AG for the development and marketing of new multiplex tests in the field of oncology.

Across in The Netherlands Amsterdam shares closed slightly higher after Wall Street traded in positive territory.

The AEX closed 1.13 point, or 0.20%, higher at the day's high of 559.14 after opening at 553.64 and reaching a low of 552.03.

Hagemeyer continued up 4.54% to 5.07 in high trade volume as speculation continued regarding the company's future after the recent 4.25 Eur-per share takeover offer from peer Sonepar, although leading Hagemeyer stakeholder Orbis Investment Management called the offer 'unacceptable'.

Another Hagemeyer shareholder, MF Global Limited, said it had built up a 6.31% stake in Hagemeyer by Oct 5 and sold it by Oct 8.

KPN also saw some trading volume, with the issue closing up 1.02% to 12.86.

Among food and drink related issues, Heineken climbed 0.98% to 46.58 and Ahold lifted 0.55% to 10.95. Numico put on 0.07% to 54.60 after spending most of the day in negative territory amid news the European Union extended the deadline for its inquiry into Danone's purchase of Numico

Oil giant Royal Dutch Shell rose 0.89% to 29.35 while oil services group SBM Offshore gained 0.38% at 28.75 and Fugro strengthened 1.68% to 57.99.

Among tech-related issues, Philips went 0.72% higher 21.15 ahead of third-quarter results expected Monday and after peer General Electric posted a higher third-quarter profit. ASML lost 0.45% to 21.97 while midcapper ASMI put on 2.94% to 20.66.

Financials turned mainly higher in late afternoon trade, with ING up 0.53% to 32.45, Aegon adding 0.21% at 14.18, and SNS Reaal adding 1.08% at 16.80. BinckBank was down 2.82% to 13.11 and Fortis shed 0.30% to 23.15 in high trading volume

Heijmans provided the news of the day, dropping more than 19% to 28.90 after the company issued a profit warning, with AFS Brokers downgrading the issue to 'reduce' and cutting its price target to 28 Eur from 36. Petercam put its 'buy' recommendation under review. Fellow construction issue BAM slipped 1.24% to 18.39 while Boskalis Westminster strengthened 2.67% t 38.84.

ArcelorMittal led AEX decliners, trading 1.84% lower to 55.46 Eur, followed by Vedior, down 1.70% to 16.81 and Unibail-Rodamco, off 1.06% to 182.66.

Local real estate listing Nieuwe Steen closed 0.26% lower to 19.35 after outperforming early in the day after it reported in-line results for the first 9 months of the year.

In Austria we saw Vienna shares close higher, as late session gains in index heavyweights OMV and banking stocks Erste Bank and Raiffeisen International helped the blue-chip ATX reverse its earlier losses and end the week in positive territory.

The ATX closed up 0.53%, or 25.49 points, at 4,858.11. The ATX Prime closed up 0.34%, or 7.86 points, at 2,319.03.

Steel conglomerate voestalpine shrugged off the lower trend among its peers and closed up 1.59% at 64.36 Eur. Boehler-Uddeholm, in which voestalpine holds a 79.2% stake, slipped 0.13% to 74.90 Eur.

BWIN posted the sharpest%age gain in the blue-chip index for a second consecutive day, rising 6.70% to 19.90 Eur in heavy volumes. Observers said the online gaming provider's strong gains in the absence of any significant news flow once again underlined the stock's highly volatile nature.

Decliners on the ATX were led by Austrian Airlines, whose shares closed down 2.58% at 7.55 Eur as the flag carrier took part in the sharp downturn among European aviation stocks.

A-TEC Industries slipped 2.40% to 162.50 Eur as investors engaged in profit-taking on the back of the stock's gains of nearly 30% over the past month.

Negative sector sentiment in the building materials sector following Credit Suisse's downgrade for Saint-Gobain contributed to Wienerberger's 1.67% decline to 45.80 Eur.

Trading in Wienerberger, which today announced plans to invest 54  Million Eur in its brick production capacity in Belgium, was also weighed down by news of a target price cut to 61.40 Eur from 66.00 Eur at Sal. Oppenheim.

On the ATX Prime, shares in Warimpex gained 0.11% to 9.32 Eur as the property developer announced plans to start construction of a four-star hotel on a site it has just purchased in the Polish city of Poznan.

Warimpex peers Immoeast and CA Immo International ended trading up 0.60% at 8.37 Eur and unchanged at 12.70 Eur, respectively, on news that a new sector report from Erste Bank identified the two stocks as having the most upside potential among the real estate stocks listed on the Vienna Stock Exchange.

Into Zurich now where Swiss shares closed lower but saw earlier losses pared by positive impetus from Wall Street, which advanced after forecast-beating retail sales and lower-than-expected core inflation data.

At the close, the Swiss Market Index was 20.80 points lower at 9,197.48 and the Swiss Performance Index was 18.28 points down at 7,494.64.

The Euro was higher against the Swiss Franc at 1.6804 while the Dollar rose to 1.1866.

Nobel Biocare led the market's underperformers, falling 2.1%, or 7 SFr to close at 330.75. Swiss Re fell 1.9%, or 2.10 SFr, to close at 110.20 after the Daily Telegraph said the company is conducting due diligence on UK life insurer Resolution. The UK's Standard Life is seeking a partner to support its bid for Resolution, the Financial Times reported.

Syngenta dropped 2.50 SFr to close at 263.00 and ABB closed 0.08 SFr lower at 32.86, off earlier lows after competitor General Electric reported third-quarter results in line with analysts' forecasts.

In pharmaceuticals, Novartis was 0.45 SFr lower, closing at 63.45 and Roche fell 1 SFr to close at 217.30.

Fellow heavyweight Nestle was unchanged at 511.50 SFr.

The market's gainers included Clariant, up 2%, or 0.30 SFr, closing at 15.50 and Swisscom, which rose 3.25 SFr to close at 446.75. Selected financials outperformed, including Zurich Financial which added 1.75 SFr to close at 366.00 and Julius Baer, up 1.2%, or 1.15 SFr, closing at 99.90. Rival UBS ended 0.25 SFr higher at 67.95, but Credit Suisse closed 0.10 SFr lower at 81.60.

Outside the SMI, BioXell closed higher, up 4.3%, or 1.90 SFr at 46.40 after phase IIb tests showed that its prostate drug Elocalcitol was effective in slowing prostate growth and alleviating adverse urinary tract symptoms associated with benign prostatic hyperplasia (BPH).

EMS was 0.80 SFr higher at 164.80 after reporting sales for the first nine months of 2007 rose to 1.160  billion SFr, an 11.3% increase in Swiss franc terms.

The pharmaceutical company cited continued positive economic trends in its main markets Europe and Asia.

Up to Scandinavia now where in Sweden Stockholm Shares closed slightly lower on profit-taking, with engineering giant Sandvik leading the market lower after a broker downgrade.

The OMX Stockholm index closed down 0.56% at 405.53, while the OMX Stockholm 30 index closed down 0.58% at 1,260.30. Turnover was 20.16  billion SKr.

The main sub-indices movers Friday were: banks down 0.82%, industrials down 1.18%, and healthcare down 0.57%.

The major movers within these indices were: Swedbank A down 2.01% at 219, Sandvik down 2.32% at 136.50, and Getinge B, down 0.91% at 162.50.

Handelsbanken downgraded Sandvik to 'Accumulate' from 'Buy', and cut its target price to 165 SKr from 170 SKr.

Ericsson B closed up 0.08% at 26.56. SEB Enskilda reiterated its 'Hold' recommendation following Sony Ericsson's third-quarter results, but hiked its target price on the share to 29 SKr from 28 SKr, valuing Sony Ericsson at 6 SKr (of Ericsson's total share price).

Truck and bus producer Scania B closed down 0.27% at 181.50 while its major owner Investor B closed down 0.57% at 175.

A truck tie-up between Scania AB, MAN AG and Volkswagen AG is 'not a must, but a possibility', Boerje Ekholm, CEO of Scania's major shareholder Investor AB, told German newspaper Handelsblatt, responding to earlier speculation that the company is preparing an offer for MAN.

In other news, Scania said it has received its largest bus and coach order to date in Asia, for 500 city buses from SBS Transit, the leading public transport company in Singapore.

Oriflame Cosmetics closed down 0.75% at 396.50 after the stock was downgraded to 'Neutral' from 'Buy' by Kaupthing Bank on valuation grounds ahead of the company's third-quarter report.

Kaupthing left its EPS estimates unchanged and its target price at 445 SKr.

'Oriflame shares have increased by 22%, and 27% relative to the OMX Stockholm index, since we initiated coverage on July 16 2007, and we now choose to take profits ahead of the Q3 report,' said Kaupthing Bank.

In Copenhagen neighbours Denmark saw Share prices close broadly lower, led by DS Torm and DS Norden on profit-taking after recent rises, while ALK-Abello rose following positive comments from broker SEB Enskilda, and Genmab extended recent rises on product news.

The OMXC20 index closed 5.62 points lower at 512.05 and the OMXCB Benchmark index fell 4.43 points to 488.41.

The OMXC All Share index closed 4.71 points lower at 500.11 on turnover of 4.97  billion DKr.

DS Torm closed 10.75 DKr lower at 229 and DS Norden fell 20 to 675 on profit-taking following recent sharp rises.

Amagerbanken advised investors to sell Torm after the broker gave the stock a short-term 'buy' on Tuesday.

Danske Markets cut its stance on Torm to 'reduce' from 'accumulate' on an unchanged target price of 234 DKr.

AP Moller-Maersk A fell 800 to 72,800 and the B-shares shed 1,300 to 73,600. Lloyds List said AP Moller-Maersk's container shipping peer Evergreen is looking for ships that can carry 12,000 TEU containers. Evergreen, which has not shown any interest in mega container ships before, expects to charter vessels rather than having them built.

ALK-Abello B rose 30 to 1,150 following positive comments from broker SEB Enskilda.

Stallergenes, ALK-Abello's main competitor and a 'leading indicator', reported surprisingly strong third-quarter sales, up 17% year-on-year to 29.2  Million Eur, which was on a par with the growth in the first half year, but above the growth in the second quarter.

Genmab was up 6 at 375 as it extended recent rises on news it has expanded an ongoing study of its drug candidate HuMax-CD4 to include patients with Sezary Syndrome, a form of cancer.

Novo Nordisk B shed 8 to 609, Lundbeck fell 0.75 to 148.5 and Coloplast was down 14 at 523.

Among other stocks traded yesterday, Vestas Wind Systems rose 4 to 456, while William Demant Holding was down 5.5 at 455, GN Store Nord fell 0.25 to 57, Danisco was 2 lower at 417, Novozymes slipped 10 to 630, Carlsberg B fell 7 to 763, Danske Bank shed 2.75 to 218.5, Topdanmark was 7 lower at 900, TrygVesta fell 1 to 439.5 and FLSmidth was down 3 at 551.

Into Finland now where in Helsinki shares closed lower led by Nokia on profit-taking after its recent gains and amid nervousness ahead of the company's third-quarter results due next week.

The OMX Helsinki 25 ended down 0.80% at 3,301.60 and the OMX Helsinki all-share index closed 1.22% lower at 12,203.67. Volume was 1.416  billion Eur.

Nokia ended 2.31% lower at 26.22 Eur, while Outokumpu was down 3.56% at 24.35 Eur and Metso 1.46% lighter at 49.14 Eur.

In forestries, shares were also lower. UPM-Kymmene finished down 0.82% at 15.64 Eur, Stora Enso R 1.18% lower at 12.52 Eur and M-real B shed 1.72% at 3.99 Eur.

M-real said it is to record a 20  Million Eur loss on the sale of its Zanders Reflex speciality paper mill in Dueren, Germany, this quarter to Arjowiggins Group.

Among the few leader board gainers was Konecranes, 1.41% higher at 30.28 Eur.

Analysts at Glitnir said this morning that recently disclosed orders suggest demand 'seems to be remaining extremely robust', boding well for the company for 2008 and 2009.

Elisa added 0.22% to 22.65 Eur, TeliaSonera finished 0.64% firmer at 6.25 Eur and Neste Oil gained 0.28% to 24.97 Eur.

Kesko B closed 0.11% lower at 45.45 Eur. The retailer said it has decided not to divest its wholesale unit Kespro Ltd as the price would have remained low. The company will develop Kespro as an independent subsidiary of the group's Food division.

Elsewhere, Elcoteq ended 1.10% higher at 4.61 Eur. The company said its Kiinteisto Oy Piiharju has sold its manufacturing facility in Lohja, Finland to Sponda Kiinteistorahasto for 6.3  Million Eur as real estate.

And rounding out the Nordic arena we go to Norway where in Oslo Share prices closed higher, led up by Tandberg Data on speculation the company has started to solve its recent problems, and by Fast Search & Transfer and Aker Kvaerner on recent order news, while bulk shipping stocks fell following recent rises.

The OSEBX Benchmark index closed 2.00 points higher at 505.44 and the OSEAX All Share index rose 2.72 points to 584.25.

Total turnover amounted to 15.21  billion NKr.

Tandberg Data closed 0.7 NKr higher at 5.05. Dealers believe today's buying could be the result of an unpublished broker upgrade.

On Aug 17, Tandberg Data stock plunged 22% after it reported a second-quarter operating loss, well below market expectations, on a 10% quarterly drop in sales. The company also cut guidance going forward.

Fast Search & Transfer rose 0.7 to 13.05 as investors responded to the positive newsflow of a run of new contracts, brokers said

Standard & Poor's said in a research note that Fast stock had risen almost 23% in the past month on a wave of contracts.

But S&P indicated that the upward surge in Fast shares had now probably peaked. It cut its rating in the group to 'sell' from 'buy', and lopped its target price to 10 NKr from 11 NKr, citing as its reasons a weaker US Dollar and the share's strong recent performance.

Telenor was 1 higher at 115.25 after Bear Stearns issued a bullish note on the telecoms group ahead of its third-quarter results later this month, dealers said.

Telenor shares have underperformed the OSEBX in recent weeks, but Bear Stearns said it remains confident in the firm's prospects despite the fact that its third-quarter numbers could be blurred by adverse foreign exchange movements and exceptionals.

Bear Stearns reiterated its 'outperform' recommendation and raised its price target to 150 NKr for 2008 compared to the 145 figure for 2007.

Aker Kvaerner ended 6.5 higher at 188.5, below the new record high of 189.5 NKr reached earlier today, as investors focused on the strong order book and recent positive news flow including new orders and brokers' upgrades.

Standard & Poor's has started coverage of Aker Kvaerner, saying that the market was recognising the strong order book, positive newsflow and sound margins, internet business page dn.no reported.

However, S&P also signalled that the latest spate of buying has been overdone. It said it has begun coverage with a 'Sell' and a 161 NKr price target, dn.no added.

Aker Yards rose 0.75 to 72.5 and Norsk Hydro was up 1.7 at 80.9.

Veidekke shed 0.25 to 58.5. Its Swedish division has signed a contract worth 340  Million SKr with Citycon to build a new shopping mall and apartments in Stockholm.

Jinhui Shipping fell 2.5 to 82 and Golden Ocean shed 0.75 to 40, while Belships added 0.1 to 30, after bulk transport shipping line stocks fell in the US overnight, despite record-high rates registered by Baltic Dry Index, dealers said.

Jinhui and Golden have surged in the last three months, rising more than 35% each as shipping rates have repeatedly hit new highs.

Shipping lines were among the stocks hardest hit when the US markets turned from positive to negative on Thursday evening, and brokers said these stocks were dragged down as a result.

StatoilHydro rose 2.5 to 182 and DNO was 0.07 higher at 11.35, as crude oil prices continued to rise on the back of yesterday's weaker-than-expected US inventory data, dealers said.

Earlier today November Brent futures surged to 80.30 usd per barrel, above yesterday's 80.15 support levels.

Pertra was down 1.25 at 80 after a week of strong gains following news of its merger with DNO's Norwegian operations.

Prosafe fell 2 to 93. It has won an order worth 67  Million usd to provide its Safe Astoria accommodation support rig to Sakhalin Energy. Operations will start offshore Sakhalin Island in Russia in May 2008

Sevan Marine was up 2.5 at 66.5. Yesterday, the firm said its 'Piranema FPSO' vessel has started production, which analysts said significantly reduces the risk of owning the stock.

Petroleum Geo-Services added 1 to 159, while Seadrill fell 1 to 127.5.

Renewable Energy Corporation was down 3.5 at 256. Dealers said there are reports that Formosa Plastics Group wants to start silicon production, and is considering collaborating with REC.

Among other stocks traded today, Orkla was 1.2 lower at 96.1, Schibsted fell 3 to 293 and Norske Skog shed 0.9 to 52.5, while Yara International added 3 to 17.5, Storebrand was up 1.4 at 89.5 and DnB NOR rose 0.7 to 86.8.

Down to the Mediterranean now and starting with Portugal where Lisbon shares closed flat as sharp gains in PT, tracking Spain's Telefonica, offset losses in blue chip EDP, while retailer Jeronimo Martins retreated from a surge earlier in the session to close sharply lower.

The PSI 20 index closed up 0.83 points at 12,815.18 after trading in a range of 12,665-12,815 on volume of around 370  Million Eur.

Equities opened lower after losses in international markets overnight and stayed in negative territory throughout the morning, although came off lows around midday.

In the afternoon, shares continued to trade in a tight range in the red, but a rally in the last half-hour brought the index to close flat.

PT surged 0.36 Eur or 3.60% to 10.35, tracking sharp gains in Telefonica SA after the Spanish operator yesterday said it will bring forward its planned dividend payment of 1 Eur per share to 2008 from 2009.

PTM was up 0.05 at 10.50, while Sonaecom, another potential bidder for PTM, slipped 0.05 to 3.76.

In the energy sector, EDP shed 0.05 to 4.25. Analysts said that confirmation of the government's sale of up to 5% of the company through an exchangeable bond issue was already in the price. Press reports said the government has retained the right to revoke the exchange element of the issue when the bond expires.

Meanwhile, oil and gas group Galp closed flat at 11.47, and electricity grid operator REN fell 0.02 to 3.51.

Banks were weak, with BES 0.08 lower at 16.67, BPI losing 0.03 to 6.27, while BCP slipped 0.03 to 3.21.

Jeronimo Martins fell 0.17 or 3.34% to 4.92, off an intra-day high of 5.49, having surged earlier in the day as dealers noted the positive news surrounding the retailer including the upcoming IPO of its Polish Biedronka unit, expectations for great results next week, and news that Ahold is moving on with its divestment plan and could get round to selling its stake in JMar Retail back to the the company.

Builders were also weak after recent gains, with Mota Engil shedding 0.11 or 1.78% to 6.07 and small cap Soares da Costa down 0.02 at 2.36.

Next door in Spain Madrid saw its market close near session highs, underpinned by a positive opening on Wall Street and as Telefonica continued to soar, while constructors saw some profit-taking.

The IBEX-35 index closed up 161.30 points at 15,261.30, after trading in a range of 14,991-15,264.

Equities opened lower, weighed down by losses overnight in the US and Asia, but the market moved into positive territory over the morning, led by Telefonica and late gains in Santander.

The IBEX-35 continued to climb steadily through the afternoon, underpinned by a positive opening on Wall Street after US data indicated that the North American economy remains strong and amid M&A news from Oracle Corp.

Telefonica put on 0.87 Eur, or 4.21%, to 21.54, on turnover of around 86  Million shares, buoyed by exuberant investor sentiment, with Citigroup raising its stance to 'buy' from 'hold' and its target price to 26.50 Eur from 19.00.

Blue-chip banks were also firmly in the black, with Santander adding 0.10 to 13.82 and BBVA up 0.21 at 17.54.

Energy transport companies were in favour, with Enagas up 0.78, or 4.23%, at 19.20 and REE adding 2.95, or 7.99%, to 39.85, after a bullish investment outlook for the next decade.

Endesa put on 0.19 to 37.57, ahead of its re-entry into the IBEX-35 index on Oct 23.

Gas Natural fell 0.47 to 38.97. Earlier, Expansion reported that Spain energy sector regulator CNE plans to put the breaks on Suez increasing its stake in the Catalan utility until the French energy group's merger project with Gaz de France is clarified.

Constructors were among the main losers amid profit-taking after recent gains, with Sacyr off 0.29 at 28.00, also depressed by a report in Le Revenu that Eiffage has not had any talks with the Spanish builder over the sale of its 33% stake in the French group.

Ferrovial lost 1.25, or 2.00%, to 61.35, while its concessionaire unit Cintra fell 0.29, or 2.48%, to 11.39, after SocGen reinitiated coverage with a 'sell' and a 9.40 Eur-per-share target price, citing substantial US exposure and high gearing.

ACS slipped 0.39 to 38.58 and FCC fell 1.40, or 2.29%, to 59.80.

Inditex fell 0.03 to 48.87, though off earlier lows after JP Morgan cut its stance to 'neutral' from 'overweight.'

Sogecable added 0.45 to 27.60, extending this week's gains amid hopes of an imminent end to the football war with Mediapro and ahead of third-quarter results due next week.

Among small caps, Vueling fell 2.44 ,or 12.74%, to 16.71, amid profit-taking from yesterday's stella rise.

Into Italy now where Milan Share prices closed slightly higher, recovering from earlier losses thanks to a positive start on US markets, with Telecom Italia and Atlantia leading the way.

The Mibtel index ended up 0.16% at 32.018 points and the blue-chip S&P/Mib index added 0.20% to 41,106, while volumes were 6.94  billion Eur.

Fallers outnumbered gainers 204 to 151, and eight shares ended flat.

Telecom Italia soared 2.82% to 2.18 Eur, moving in line with other European telecom stocks.

Telefonica, through the Telco consortium, is also set to become the major shareholder of Telecom Italia by acquiring a stake from Pirelli.

Pirelli rose 1.81% to 0.867, on hopes that the Telecom Italia stake sale would be finalised.

Lottomatica fell 2.09% to 27.15, on the weak Dollar trend.

Among other US-exposed companies, Autogrill was down 1.37% at 13.94 and Luxottica down 1.29% at 25.99.

Banking shares were weak, with Intesa Sanpaolo down 0.24% at 5.5, amid vague rumours it could be interested in Commerzbank, while Unicredito fell 0.15% to 6.16.

Italease rose 1.46% to 14.05, after confirming reports it has obtained a 950  Million Eur financing from Banco Popolare and other members of its shareholder pact.

Banco Popolare was down 0.50% at 17.06.

Enia added 5.44% to 11.6 and Iride fell 0.79 to 2.63, on merger speculation.

Officials said Enia and Iride will start studying the possibility of an alliance which then could be extended to other utilities to form a large company serving northern Italy.

And rounding out Europe this week we go to Athens where Greek shares closed slightly higher and recovered from earlier losses, with the blue chip index led up by Hellenic Telecomms (OTE) and Coca-Cola HBC (CCHBC).

The ASE general index closed 0.3% higher at 5,289.2 and blue chips climbed 0.2% to 2,803.1. Midcaps ended little changed at 6,802.6 and small caps slid 0.3% to 1,148.8.

Decliners outnumbered advancers 141 to 108, while 59 were unchanged in average trade volume of roughly 436  Million Eur.

Hellenic Telecomms (OTE) spiked 3.7% to 26.98 Eur late in the session on further speculation that the Greek state will find a European strategic investor for the company.

Bottler Coca-Cola HBC jumped 2% to 40.6 Eur, rebounding from heavy profit-taking over the past two sessions.

Electricity utility Public Power Corp (PPC) led blue chip decliners throughout the session and dropped 2.8% to 29 Eur on profit-taking after outperforming the market over the past few sessions. PPC has risen 29% over the last month.

Bank of Cyprus closed 2% lower at 13.52 Eur as investors cashed in on recent gains.

Refiner Motor Oil jumped 1.9% to 18.88 Eur on high crude prices that should boost inventory gains. In other news on Motor Oil, it announced that an additional 2.1  Million Eur tax charge will be posted to unit Avinoil's 2007 results which brokers say is not significant for the company.

Marfin Popular Bank (MPB) edged 0.2% higher to 10.2 Eur after it said it will sell its 6.45% stake in Marfin Investment Group (MIG) at the end of its compulsory holding period which expires Jan 16 2008.

Investment holding company MIG slid 0.6% to 6.7 Eur and said that it has acquired 5.02% of MPB.

Betting technology group Intralot lost 0.2% to 29.44 Eur as profit-taking offset broker Deutsche Bank's report where it upped its target price by 3% to 32.8 Eur and kept its 'buy' rating because of its new Australian contract win. In other news on Intralot, its EGM was rescheduled for October 24 due to a lack of quorum at today's meeting.

Cooler company Frigoglass fell 0.5% to 24.28 Eur and was unaffected by broker Piraeus Securities upping its target price to 24.5 Eur from 21.1 Eur on the recent completion of its plant in China.

UK Market - UK blue chips enjoyed a late rally and closed near their highest in seven years, with FTSE 100 heavyweight BP extending yesterday's gains and Wall Street shares edging up, encouraged by retail sales and inflation data.

At the close, the FTSE 100 index was up 6.2 points at 6,730.7, up from the session low of 6,660.0. The index is now just 1.7 points short of the seven -year closing high of 6,732.4 of June 15. The FTSE 250 index was down 46.6 points at 11,576.3.

Volume was average, with 3.16  billion shares having changed hands in 538,430 deals.

In London, index heavyweight BP added the most points to the FTSE 100, closing up 25-1/2 pence, or 4.3%, at 619 pence, a 12-month high. The shares were building on gains from yesterday, when BP unveiled restructuring plans.

BP was also helped by oil prices heading back to near record levels. Brent for November delivery was trading at 80.40 usd a barrel as the London stock market was closing.

BG Group closed 13 pence higher at 896, a 12-month high.

But the biggest FTSE 100 gainer was Northern Rock, up 15-1/4 pence at 273-1/4 pence, more than double its value of two weeks ago.

Virgin Group, the travel and telecoms group led by celebrity entreprenEur Sir Richard Branson, confirmed it is planning a takeover of the ailing mortgage bank, as part of a consortium of US and Asian investors.

In a statement, Virgin said the consortium has submitted a proposal to the Northern Rock board under which it would inject 'substantial' new equity into the bank.

Under the deal, Northern Rock would be combined with Virgin's financial services unit, Virgin Money, under the leadership of chief executive Jayne-Anne Gadhia, Virgin said.

The consortium comprises of US insurer AIG, US private equity firm WL Ross, UK hedge fund manager Toscafund, and Hong Kong-based investment house First Eastern Investment Group.

Earlier, Hichens Harrison upgraded the shares to 'hold' from 'reduce', saying a bidding war could see the company sold for more than 300 pence per share. The broker did, though, also point out that further bad news or a long drawn out process could lead to very little value remaining.

Meanwhile, bid talk boosted shares in Resolution, 16-1/2 pence higher at 708-1/2 with the Financial Times reporting that Standard Life is looking for a partner to support it in a possible rival bid for the company which has already agreed to merge with Friends Provident.

Standard Life shares ended the day 7-1/4 pence lower at to 289-1/4.

Separately, the Telegraph said reinsurer Swiss Re is thought to be conducting due diligence on Resolution.

Meanwhile, Friends Provident was upgraded to 'outperform' from 'peer perform' at Bear Stearns as the broker believes the probability that the deal with Resolution will succeed has risen. Shares added 1 pence to close at 181 pence.

Fund manager Schroders led the FTSE 100 fallers. The shares closed 48 pence lower at 1,303 after Evolution Securities cut its rating to 'reduce' from 'add' on valuation grounds. The shares have enjoyed a strong run recently, some of which was fuelled by speculation it would sell off its investment management arm and concentrate on private banking.

Evolution also cut its rating on Invesco, to 'reduce' from 'buy'. Invesco was down 11-1/2 pence at 723.

Some miners remained lower, though in some cases they were well off lows for the day. Citigroup downgraded the basic resources sector to 'neutral' yesterday morning.

Anglo American closed 45 pence down at 3,435. Xstrata closed 6 pence lower at 3,586, having been much lower earlier in the day. Others made an even stronger recovery in the afternoon. Rio Tinto ended the day up 13 at 4,576.

Housebuilders were weak, against the background of yesterday's RICS house price news and recent sector downgrades by UBS.

Yesterday, in its monthly survey of the housing market, the Royal Institution of Chartered Surveyors said 14.6% more of its members reported a fall than a rise in house prices in September, well above August's -3.3% reading.

Barratt Developments fell 23 to close at 699. Persimmon was down 27 pence at 976, and FTSE 100 newcomer Taylor Wimpey lost 9-1/2 pence to close at 281-1/4.

Midcap peer Redrow fell 8-1/2 pence to 380, with Bellway down 14 pence at 1,062, ahead of results on Tuesday.

But Bovis Homes was up 10 pence at 694 pence after the group said it has acquired Elite Homes Group from its existing directors and related trusts for 25.7  Million stg in cash, plus assumption of 46.2  Million stg of net debt.

Panmure Gordon said the deal is quite small but cheered the 'reasonable' price paid.

Elsewhere, shares in Centrica fell 6-1/2 pence to close at 383, after the company said it was going to withdraw a 200  Million stg project to redevelop a key gas terminal in frustration over planning delays and regulation battles.

Among the second liners, certain companies were obvious beneficiaries of high oil prices. Cairn Energy soared 71 pence, or 3.2%, to 2,261, a 12-month high. Dana Petroleum rose 46 pence to 1,304.

But Rank Group fell 34 pence, or 21.4%, to close at a 12-month low of 125 after a downbeat trading statement.

The company said its UK retail businesses, Mecca Bingo and Grosvenor Casinos, have experienced a significant deterioration in revenue in recent weeks.

This was largely attributable to a combination of the loss of some gaming terminals, due to new legislation, and the bans on smoking in enclosed public places.

Japan & Asia Pacific - Stock markets across Asia fell Friday with Hong Kong, Singapore, China and South Korea retreating from records as investors used Wall Street's overnight decline as an excuse to lock in gains.

Japanese stocks fell Friday after a three-day advance, as investors took profits in real estate and exporter shares.

The Nikkei 225 average declined 127.81 points, or 0.73%, to 17,331.17 points on the Tokyo Stock Exchange. The index has gained 2.3% over the previous three days, including Thursday's gain of 1.64%.

Friday's losers included Mitsubishi Estate Co., which shed 2.3% at 3,420 Yen. Banks also dropped after Lehman Brothers cut price target on major Japanese banks. Sumitomo Mitsui Financial Group Inc. lost 2.7% at 927,000 Yen.

The broader Topix index, which includes all Tokyo Stock Exchange's first section issues, fell 18.04 points, or 1.08%, to 1,659.48 points.

Supermarket chain operator Daiei closed down 15 Yen or 1.7% at 888 Yen. Daiei reported a 79.7% fall in operating profit for the first half to August on lower sales and losses at credit card subsidiary OMC Card.

For the full year, the company projects operating profit of 16.0 billion Yen, 66.9% less than it made the year before, and net profit of 48.0 billion Yen, down 16.2%, on operating revenue of 1.20 trillion Yen, down 6.5%. In Malaysia, shares of diversified conglomerate DRB-HICOM were down 2 sen or 1% at 1.91 ringgit as they resumed trading after the company said it will pay 1.069 billion ringgit for a 70% stake in Bank Muamalat, Malaysia's second fully-fledged Islamic bank.

Hong Kong retreated from record highs Friday. There is growing apprehension among investors that Beijing will take definite steps to tighten liquidity in the mainland's burgeoning economy.

The 40-stock Hang Seng Index closed 294.65 points or 1% lower at 28,838.37, off the day's low of 28,368.69.

Volume crossed 17.86 billion shares worth 195.27 billion Hong Kong Dollars.

Breadth was negative with decliners beating gainers 694 to 312, while 122 stocks were unchanged.

Financial stocks led losses, with the Finance Index 500.90 points or 1.1% lower at 44.756.39.

PetroChina, the Hong Kong-listed arm of China's largest oil producer China National Petroleum Corp, hit fresh highs on a new gas field discovery in the nation's northwest Xinjiang region.

PetroChina shares rose 1.18 Hong Kong Dollars or 7.6% to 16.62 Dollars after hitting a record high of 16.82 Dollars earlier today.

New World Development, a property-telecom diversified conglomerate, also made sharp gains, up 2.3 Dollars or 10% at 25.20 Dollars after tripling its net profit in the year to June.

In Mainland China , A-shares closed down -- but well off their lows -- on profit-taking, after hitting a new intra-session record high.

Banks, which led the gains Thursday, were hit the hardest.

The benchmark Shanghai Composite Index lost as much as 4.9% in the early minutes of the afternoon session before losses narrowed, largely helped by a recovery in ICBC.

The index ended the day down 9.97 points or 0.17% at 5,903.26, off a new intraday high of 5,959.36.

Turnover rose to 219.29  billion Yuan from 177.99  billion Yuan in the previous session.

Industrial and Commercial Bank of China (SHA 601398; HK 1398) ended down 0.14 Yuan at 7.65. It lost as much as 5.8% today as investors locked in gains of 7% over the past two days.

Bank of China lost 0.18 Yuan to 6.48 and China Minsheng Banking Corp Ltd shed 0.57 Yuan to 16.81.

Property developers also dragged down the market. Poly Real Estate Group Co Ltd tumbled 5.02 Yuan to 76.00.

China Vanke Co Ltd shed 1.38 Yuan to 32.89.

However, energy large caps remained strong.  China Petroleum & Chemical Corp (Sinopec) gained 1.49 Yuan to 23.24.

Haitong Securities Co Ltd soared 4.99 Yuan or 10% to 54.92, after it projected nine months net profit exceeding 4  billion Yuan, against 259.69  Million a year earlier.

The Shanghai A-share Index fell 10.87 points or 0.18% to 6,196.97 and the Shenzhen A-share Index was down 18.22 points or 1.13% at 1,594.33.

The FTSE/Xinhua China A 50 Index was down 47.65 points at 22,719.96 and the FTSE/Xinhua China A 200 Index was down 61.86 points at 16,577.61.

China B-shares closed mixed with property developers lower on concerns over their earnings outlooks.

Volatility in the A-share market also dampened investor enthusiasm.

Jiangsu Xincheng Real Estate fell 0.105 usd to 2.460, after projecting net profit for the first three quarters falling more than 50% year-on-year.

The Shanghai B-share Index rose 3.32 points or 0.88% at 382.24 and the Shenzhen B-share Index fell 13.17 points or 1.69% to 766.51.

In Taiwan , Taipei Share prices closed substantially lower as Wall Street's overnight decline set the pace for local trade from the opening bell and continued to influence sentiment throughout the session.

Financial and technology heavyweights led the downturn, with investors opting to cash out after the market had repeatedly tried and failed to breach the year's trading high of 9,807 points hit on July 26.

The weighted index closed down 201.20 points or 2.07% at 9,496.47, off a low of 9,490.01. It hit a high of 9,731.16.

Turnover totaled 153.32  billion twd.

For the week, the index lost a cumulative 120.79 points, or 1.26%.

Decliners led risers 1,594 to 386, with 203 stocks unchanged.

A total of 22 stocks closed limit-down and eight limit-up.

The heavily weighted financial and electronics sectors were down 3.45% and 2.33%, respectively.

The food sector was down 2.42%, textile down 2.04%, plastics/petrochemicals down 0.82%, paper down 0.44%, construction down 0.16% and cement down 0.06%.

Cathay Financial closed down 3.40 twd, or 4.06%, at 80.40, while Shin Kong Financial slipped 0.90 twd, or 2.88%, to 30.40.

Chinatrust Financial tumbled 1.05 twd, or 4.17%, to 24.10 despite a ratings outlook revision to positive from stable by Standard & Poor's unit Taiwan Ratings.

TSMC lost 2.00 twd, or 3.16%, to 61.30, while UMC shed 1.10 twd, or 4.91%, to 21.30.

Hon Hai was down 6.00 twd, or 2.37%, at 247.00. A Hon Hai group spokesperson said he is not aware of plans as reported in the papers that the group is planning to invest in China's Alibaba.com.

Chi Mei Optoelectronics tumbled 1.60 twd, or 3.93%, to 39.10, failing to benefit from the company's announcement that its unit, Nanhai CMO, has started mass production of liquid crystal display (LCD) modules in China's southern Guangdong province.

Acer was down 2.10 twd, or 3.40%, at 59.60, although the PC vendor said it has completed a tender offer for US-based Gateway.

Profit-taking also sent the share prices of Formosa Plastics group falling, even after the group announced it plans to invest 782.8  billion twd in petrochemical, technology and steel businesses between 2007 and 2011.

Formosa Plastics was down 1.50 twd at 98.00, Nan Ya Plastics down 1.40 at 95.20, Formosa Chemicals down 0.30 at 89.00 and Formosa Petrochemical down 3.00 at 100.50.

Markets in Indonesia and The Philippines were closed for public holidays Friday.

South Korean shares closed lower Friday in tandem with key markets across Asia as investors took Wall Street's decline as cue to grab profits after the KOSPI index posted its third straight record finish in the previous session.

Technology bellwether Samsung Electronics made only a modest gain, even after it surprised the market with strong third-quarter earnings, as some analysts raised concerns over the outlook for the chip sector.

Running against the government's hopes for a sovereign rating upgrade, Standard & Poor's Ratings Services has affirmed its ratings for South Korea at 'A/A-1', and this added to the market's negative tone. S&P is keeping its stable outlook on the ratings.

S&P said easing geopolitical tensions arising from North Korea's nuclear program has been offset by a sharp rise in South Korea's external liabilities.

The KOSPI index closed down 32.41 points or 1.6% at 2,026.44, after trading between 2,020.80 and 2,057.39. It ended the week with a gain of 30.41 points or 1.5%.

Volume traded reached 449 million shares worth 9.0 trillion Won.

Decliners beat gainers 593 to 223, with 45 issues unchanged.

Institutions were net sellers of shares worth 330.5 billion Won while retail investors were net buyers of 514 billion Won worth. Foreign investors were net sellers of 185.4 billion Won in shares.

Samsung Electronics rose 2,000 Won or 0.4% to 557,000 Won after rising to as high as 572,000 Won.

The world's leading chip, handset and display maker reported that its third-quarter operating profit more than doubled from the second quarter to 2.07 trillion Won, thanks to improved performance at its semiconductor and flat panel display operations.

The latest figure was the strongest since the fourth quarter of 2005 and surpassed market forecast for an operating profit of 1.7 trillion Won, according to the average estimate of 27 brokers polled by Thomson Financial.

LG Philips LCD slumped for a second day, losing 2,400 Won or 5.4% to 41,800 Won, as investors followed the sale of shares by its second-largest shareholder, Royal Philips Electronics NV, after the display maker reported upbeat quarterly results on Tuesday.

Banks were sharply lower due to institutional selling. Kookmin Bank dipped 3,400 Won or 4.1% to 79,000 Won and Shinhan slid 2,500 Won or 3.9% to 62,200 Won.

POSCO was off 21,000 Won or 3.0% at 679,000 Won amid reports that its former employees were accused of leaking the company's core steel technology to a Chinese rival.

LG Corp jumped 4,100 Won or 5.3% to 81,500 Won after Samsung Securities raised the target price for the stock to 95,300 Won from 80,400 Won, reflecting higher values of its shareholdings in units and affiliates, including LG Philips LCD and LG Electronics.

Samsung Corp extended heavy gains for a third day, rising 2,900 Won or 4.0% to 75,700 Won, as investors welcomed its latest purchase of Samsung Petrochemical from British Petroleum.

Singapore shares closed lower Friday, in line with regional markets as investors locked in gains following Wall Street's retreat overnight.

The prevailing positive market sentiment, meanwhile, tempered the decline in the benchmark index.

The Straits Times Index fell 18.52 points or 0.5% to 3,857.25, after swinging between a high of 3,864.02 and a low of 3,828.45 points.

The index recorded gains of just 34.63 points during a volatile week that saw the index trading within a 93.29-point range.

Volume reached 2.7 billion shares valued at 2.5 billion Singapore Dollars.

Losers outpaced gainers 557 to 259, with 1,706 stocks unchanged.

Malaysian shares closed Friday lower as traders continued to take profits ahead of the extended weekend, with the selling of index-linked stocks pushing the key index lower.

The weak performance of other Asian markets and Wall Street's retreat overnight further dampened sentiment.

Many market participants have left the capital Kuala Lumpur for a long weekend to mark the end of the Muslim fasting month of Ramadan, which begins tomorrow. Malaysian financial markets will be closed on Monday.

The Kuala Lumpur Composite Index was down 8.36 points or 0.6% at 1,375.25.

For the week, the KLCI gained 3 points or 0.2%.

The FTSE Bursa Malaysia 30 large-cap index lost 74.48 points or 0.9% to 8,658.97 and the second board index edged down 0.16 point or 0.2% to 107.97.

Decliners led gainers 442 to 371 with 284 counters unchanged.

Volume traded was lower at 1.4 billion shares valued at 1.9 billion ringgit.

Thai shares closed slightly lower Friday in line with most regional stocks on profit-taking after hitting an 11-year high a day earlier.

Foreign fund inflows continued but buying was seen only in selected big-cap energy stocks following a spike in oil prices.

The Stock Exchange of Thailand (SET) composite index shed 2.04 points or 0.2% to 887.02 and the blue-chip SET-50 index slipped 0.93 point to 651.63.

Losers overwhelmed gainers 210 to 94, with 140 stocks unchanged. Turnover was 2.6 billion shares worth 26.7 billion baht.

Top energy shares rose after world oil prices shot up overnight, he said, striking an all-time peak of 84.10 on New York crude.

Thailand's top energy firm PTT rose 4.00 baht to 352.00, and its subsidiary PTT Exploration and Production gained 7.00 to 158.00.

The nation's top lender Bangkok Bank lost 2.00 to 125.00.

Thai Airways International dropped 0.50 to 42.50. The kingdom's largest mobile phone operator Advanced Info Service fell 1.00 to 95.00.

Indian shares closed lower despite hitting a record high during the session as investors took leads from weaker world markets and locked in profits after the runaway rally this week.

The Bombay Stock Exchange's benchmark Sensex closed 2.10% or 395.03 points lower at 18,419.04. The equity market barometer had earlier hit an all-time high of 18,844.62 points on demand for the shares of India's most valuable company Reliance Industries Ltd. The National Stock Exchange's S&P CNX Nifty closed 1.75% lower at 5,428.25.

Among the BSE 30, 4 shares gained and 26 lost. In the broader market, 1,052 shares advanced, 1,693 declined and 56 were unchanged.

Infosys fell 2.31% to 1,930.45 rupees, Wipro Ltd eased 0.34% to 486.45 rupees and Tata Consultancy Services Ltd closed 0.82% down at 1,063.10 rupees.

Reliance closed 2.39% lower at 2,566.85 rupees. The stock had risen to a record 2,724 rupees as traders anticipated some bounty for shareholders at the oil refiner and petrochemicals giant's annual general meeting held today in Mumbai.

Banking shares also saw profit-booking. ICICI Bank slipped 3.37% to 1,053 rupees, while State Bank of India closed 4.23% lower at 1,862.30 rupees. As of today's close, ICICI Bank has gained 19.02% since last month, while State Bank of India has risen 14.66%.

Australian shares closed lower Friday as investors locked in gains after a 4-day winning streak which propelled the key market indices to record highs, though index leader BHP Billiton managed to end the week at a record high on continued offshore buying.

The S&P/ASX 200 closed down 23.0 points or 0.3% at 6,748.9 after trading between 6,717.7 and 6,752.8.

The All Ordinaries index ended down 19.5 points or 0.3% at 6,760.1.

BHP Billiton finished up 16 Australian cents or 0.4% at 46.20 Dollars, beating its previous record close of 46.05 Dollars struck on October 2. Rival Rio Tinto fell 42 cents or 0.4% to 111.70 Dollars.

Volume traded was a relatively light 1.86 billion shares worth about 5.6 billion Dollars. Gainers outstripped decliners 647 to 636 with 348 stocks unchanged.

The S&P/ASX 200 December futures contract was down 32 points at 6,794.

The yield on the 10-year bond was steady at 6.238%, while the yield on 90-day bills eased 0.017 of a%age point to 6.858%.

Precious metal stocks were among the day's best gainers following strong rises in gold and platinum prices.

Australia's largest gold miner Newcrest ended up 9.0 cents at 5.28 Dollars, Lihir Gold rose 4.0 cents to 4.14 Dollars and Aquarius Platinum jumped 1.32 Dollars or 3.3% to 41.32 Dollars.

Other miners were broadly lower, with Zinifex down 19.0 cents or 1.0% at 18.59, Alumina off 9.0 cents or 1.3% at 6.70 Dollars and Mincor dropping 10 cents or 2.2% to 6.10.

Manganese miner Consolidated Minerals pared earlier losses to end down 1.0 cent at 4.79 Dollars after receiving an increased final offer or 4.50 Dollars a share from privately held Pallinghurst Resources.

Interest in emerging iron ore miners waned after solid gains earlier in the week following Murchison Metals launching an all paper offer for smaller rival Midwest Corp.

Murchison fell 17 cents to 5.32 but Midwest eked out a 1.0 cent gain to close at a record 4.91 Dollars.

Woodside fell 46 cents to 53.95 despite higher oil prices. The leading oil and gas group received environmental approval from the federal government for the development of its wholly owned Pluto liquefied natural gas project after the market closed. The company wanted approval before the federal elections as the opposition Labor Party had given no guarantees regarding approvals should it win government.

Engineering services and project management group WorleyParsons ended down 19 cents or 0.4% at 44.45 Dollars despite providing an optimistic outlook at its annual meeting.

Banks were largely lower, though Commonwealth Bank added 14 cents to 59.79 Dollars. National Australia Bank fell 9.0 cents to 41.76 Dollars, ANZ dropped 8.0 cents 31.47 Dollars and Westpac ended off 17 cents at 29.66 Dollars.

Leading investment bank Macquarie Bank shed 1.10 Dollars or 1.3% to 86.40 Dollars, while investment firm Babcock & Brown fell 53 cents or 1.8% to 28.78 Dollars.

Australia's second largest retailer, Coles Group, rose 8.0 cents or 0.5% to 15.94 Dollars ahead of its shareholders voting next month on the share and cash takeover proposal from conglomerate Wesfarmers, which ended down 34 cents or 0.8% at 43.01 Dollars.

The nation's largest retail group, Woolworths, fell 19 cents or 0.6% to 31.31 Dollars.

New Zealand shares closed slightly higher Friday with electricity generation firms in the spotlight in otherwise subdued trade.

The benchmark NZX-50 index rose 9.01 points or 0.21% to 4,305.62 on turnover worth 94.7 New Zealand million Dollars.

Market leader Telecom fell 6 cents to 4.44 Dollars, while Fletcher Building jumped 23 cents to 12.78, and Contact Energy rose 22 cents to 9.57 in reaction to the government's energy strategy released Thursday.

TrustPower was flat at 9.15 Dollars, after hitting a record high 9.30 during Thursday's session. New Zealand Windfarms was up 9 cents at 1.35, and 19.9% shareholder Vector was up 2 cents at 2.42.

Fisher & Paykel Appliances rose 5 cents to 3.70 Dollars. The whiteware manufacturer was expected to benefit from government moves to encourage the replacement of old, energy wasting fridges. Fisher & Paykel Healthcare was up 1 cent at 3.30 Dollars and Sky TV lost 5 cents to 5.70.

Commodities - Crude oil prices hit an all-time high of $84 a barrel Friday amid concerns that Turkey might invade northern Iraq. Stocks also fell rapidly before the peak winter season.

Base and precious metals made gains during the week on a weak US Dollar and positive sentiment emerging from London Metal Exchange week, the sector's main annual event.

Nymex November West Texas Intermediate was up 92 cents in late London trading to $84.00 a barrel, 3.5% higher on the week, and just above its previous high of $83.90 a barrel reached in late September.

ICE November Brent rose 60 cents to $80.75 a barrel, up 2.3% on the week.

The price surge came as US inventories were falling. And the International Energy Agency, the western countries' energy watchdog, warned that stocks in developed countries had declined in the third quarter to 53.5 days of supply, compared with 55 days in the second quarter.

The oil price surge, which spurred inflationary concerns, and the renewed weakness of the US Dollar propelled gold prices during the week to a new 28-year high of $753.60 an ounce. Profit taking on Friday pushed down the price to $749.90 an ounce, still 0.7% higher on the week.

Into metals now and analysts this week stated that gold prices will average $800 an ounce in 2008 as an “expanding middle class in the developing countries” would continue to buy physical gold, underpinning prices.

Jewellery demand rose 23% in the first six months of the year compared to the same period in 2006, led by India, China and the Middle East, which were up 77%, 21% and 16%.

Gold prices surged to an all-time record of $850 an ounce in panic buying in January 1980.

Aluminium ended the week 2.7% higher to $2,434 a tonne while copper, although consolidating above the key $8,000-a-tonne level, lost 1.9% to $8,060 a tonne.

Lead also hit a high of $3,828 a tonne and ended Friday at 3,825 a tonne, up 3.7 per on the week.

Deutsche Bank said most of the participants in LME week's agreed that in the shorter-term, there will certainly be a slowdown of demand in the US as a result of the credit squeeze and housing market weakness. But the participants felt that the booming emerging market economies will more than offset the US deceleration.

Agricultural and soft commodities were mixed as the weather hit some crops and higher prices in others spurred farmers to increase planting.

CBOT December wheat ended the week 3.8% down, to $8.56 a bushel while CBOT December corn rose 2.3% to $3.50 a bushel.

Robusta coffee jumped to a 10-year high of $2,234 a tonne.

Currencies - The Dollar struggled against the Euro for much of this week, displaying a higher sensitivity to bad news over encouraging data such as the narrowing in the August trade deficit, announced on Thursday.

On Friday, the Dollar found itself pulled between stronger-than-expected retail sales in September and an unexpectedly sharp drop in consumer confidence. With headline retail sales growth flattered by higher spending on petrol and cars, core US consumer spending appears to be losing momentum.

The Euro rose 0.3% to $1.4173 over the week

Approaching the next meeting of the Group of Seven leading industrialised nations, Hank Paulson, US treasury secretary, and even George W.?Bush, US president, have joined other policymakers in calling for a “strong Dollar” but these efforts appear to have fallen on deaf ears.

The debate on exchange rates has clearly intensified in advance of the G7 meeting and some European politicians have voiced concerns at the Euro's strengthening as a rapid appreciation could pose significant risks to the Eurozone's growth prospects.

But whether policymakers can agree some kind of co-ordinated intervention that spreads the burden of adjustment more evenly between the Euro and leading Asian currencies remains highly uncertain.

Supported by forecast-beating industrial production numbers from Germany, France and Italy, the Euro rose 0.6% to £0.6925 this week.

Further evidence of a slowdown in the housing market from the latest survey by the Royal Institution of Chartered Surveyors kept Sterling under pressure, but Mervyn King, governor of the Bank of England, poured cold water on hopes for an early cut in interest rates in comments emphasising the risks to price stability from rising inflation expectations. Sterling fell 0.4% to $2.0341 this week.

The Bank of Japan kept interest rates unchanged at 0.5% this week, but increased volatility in currency markets is limiting capital outflows. In September, foreign security investments by Japanese investment trusts sank to Y231bn net, the lowest since December 2004.

Barclays Capital said it appeared the Yen had been driven lower recently by overseas speculative flows rather than Japanese structural flows.

The Dollar rose 0.4% to Y117.48 this week while the Euro rose 0.7% to Y166.44.

Improving investor appetite for risk has driven many Asian equity markets to record levels and equity inflows have helped currencies in the region rally strongly since mid-August.

Growing pressure on Asian policymakers to allow faster currency appreciation is evident.

This week, Singapore decided to allow its crawling exchange rate policy band to rise at a faster rate than before in an unprecedented move to tighten monetary policy.

The Dollar fell 0.6% to S$1.4631.

Ahead of the G7 meeting, pressure is also mounting on the Chinese authorities to allow greater exchange rate flexibility. China continues to amass foreign exchange reserves at a vast rate, up $101bn to $1,434bn in the third quarter. Analysts said the figure could be understated as some reserves were likely to have been invested in China's new sovereign wealth fund.

The South African Rand remained firm against other major currencies in late trade on Friday but was off the day’s best levels after soaring to a 16-month best level against the Dollar late on Thursday after the South African Reserve Bank’s Monetary Policy Committee (MPC) surprised by announcing a 50 basis points hike in the repo rate.

The Rand was bid at 6.7500 per Dollar from its overnight close of 6.7238. It was bid at 9.5675 to the Euro from a previous 9.5509 and at 13.7223 against Sterling from 13.6958 before.

Rounding out currencies this week, as always at home with the RMB. The RMB finished at 7.5110 to the Dollar on the over-the-counter (OTC) market, compared to 7.5057 Thursday.

China - Shares in Shenhua Energy, a subsidiary of China’s largest coal producer, nearly doubled on their trading debut on Tuesday, setting records for a market riding a wave of domestic liquidity.

Shenhua raised $8.9bn – the world’s largest initial public offering this year – and attracted $354bn in subscriptions, a Shanghai market record.

Chinese analysts cited huge demand for resource stocks and Shenhua’s bright earnings’ prospects in explaining the 87% rise in its share price.

Formed 12 years ago as part of an attempt to consolidate China’s coal industry, Shenhua is the country’s largest coal miner, a major operator in resource logistics through its control of railways, ports and ships and is also expanding aggressively in the coal-to-liquids and coal-to-chemicals sectors.

But the underlying reasons for the day one jump are more fundamental – the huge liquid funds that are largely trapped inside China by capital controls and a shortage of other investment opportunities.

Large Chinese state companies, which have made large profits in recent years, are significant stock market investors, especially in IPOs.

China has about 100m registered stock trading accounts but only about 1.4m of them applied for shares in the IPO, an indication the lottery was dominated by large investors.

Chen Biting, the Shenhua chairman, said the spectacular debut was more than justified by the quality of the enterprise’s assets.

“The price is within expectations but I’m still not satisfied,” he told reporters.

In spite of government attempts to talk it down, the overall market remains robust and in record territory, with the Shanghai Composite Index closing on Tuesday at 5,716 points.

Shenhua’s debut will please regulators, which have pushed for large companies to list at home over the past year to give the local market greater ballast. Recent listings include Bank of Beijing, China Construction Bank and China Oilfield Services.

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Pressure on Beijing to revalue its tightly managed currency is set to intensify in Europe after booming exports to the region powered China to a $24bn trade surplus in September as growth of sales to the US slowed.

China’s trade surplus jumped 69% to $185.65bn for the first nine months of the year, surpassing the amount for the whole of 2006 and adding to rising angst in the European Union over Beijing’s currency regime.

Growth in exports from China to Europe has been outpacing sales to the US, even before recent scares in North America over the safety of some Chinese-made goods. This year, Europe overtook the US as the biggest destination for Chinese exports. “The rise of European market is good news for sustaining Chinese export growth, but, in the end, it might prompt Europe to become more actively engaged in pressing on China’s currency,” said Yiping Huang, of Citigroup, in Hong Kong.

The 13-nation Eurozone’s ministers broke new ground this week with a statement that identified the Renminbi’s level as a greater source of concern to Europe than the Dollar or the Japanese Yen.

The Renminbi has risen about 10% against the Dollar since mid-2005, when Beijing broke its long-standing peg to the greenback, but has fallen against the Euro during the same period.

In the nine months to the end of September, Chinese exports to the EU and the US increased 37 and 16% year-on-year respectively, reflecting the strength of Europe’s economy and the Euro exchange rate, according to Bank of America.

China pledged to manage the Renminbi against a basket of global currencies when it broke the Dollar peg. However, the currency since then has appeared to track the greenback.

Few economists believe that a stronger Renminbi will transform bilateral trade relations with Beijing, as China’s export growth reflects in part its repositioning as the last point of assembly for Asian goods shipped overseas. But the Renminbi has become a political symbol in Washington and now Brussels of what many say is Beijing’s policy to keep its currency low to support exports.

Robert Kimmitt, US deputy treasury secretary, said yesterday China needed to “move considerably more quickly to valuing their currency based on underlying economic fundamentals”.

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China’s communist elite began gathering in Beijing on Friday night, readying for the quinquennial congress that will consecrate the country’s leadership until 2012 and anoint the next generation of party bosses.

The 2,217 delegates to the congress have been winnowed down from the party’s 73.4m members through a tightly controlled process in which representatives are selected from approved lists of candidates.

The line-up of provincial and city party bosses, ministers, state enterprise executives and senior generals has been leavened by a few high-profile celebrity delegates, including actors, sports stars and China’s first astronaut.

The congress opens on Monday and takes place mainly in secret, in the Great Hall of the People and tightly guarded hotels. The closing date has yet to be announced, but the 2002 congress lasted a week.

Beijing has been awash with almost as many rumours as there are delegates in the lead-up to the conclave about changes to the leadership’s inner circle, the Standing Committee of the Politburo, and other senior posts.

Hu Jintao is presiding over his first congress as party secretary, amid a hazy evolution of the conventions of elite Chinese politics driven by the absence of old-style party barons who could dictate the choice of new leaders.

Mr Hu and Jiang Zemin, his predecessor, were both in effect chosen by Deng Xiaoping, but the modern party does not have a figure of his revolutionary stature and policy record who could do the same today.

The party now is more consensus-driven, rendering decision-making slower and more deliberate, and requiring extensive balancing and co-operation among competing factions, personalities and regions.

China’s extraordinary economic growth in the last five years and the country’s growing global footprint has also made governing more difficult and complex.

Mr Hu has gradually consolidated power since becoming party secretary and president in 2002 and 2003 respectively, but he does not appear to have the authority to impose his will on the selection of a new politburo.

Mr Hu may attempt to make a virtue out of such limits, by ensuring that a number of potential successors are positioned to compete for the top post in 2012, possibly in an internal party election.

He has promoted “internal democracy” in an effort to lift the professional standards of officials, limit opportunities for corruption and make the government more responsive to public opinion.

The prospect of genuinely competitive internal elections is controversial, however, for fear that they will formally institutionalise infighting within the party.

The extent to which Mr Hu has been forced to compromise will be evident only when the new standing committee is unveiled, a moment of high drama that marks the close of the congress.

The new standing committee is unveiled with theatrical pomp when the new members are paraded on a stage in the Great Hall of the People in order of their newly established seniority.

The two favoured candidates for elevation to the senior ranks of committee are Li Keqiang, the party secretary of Liaoning and a long-time Hu ally, and Xi Jinping, who took over the leadership of Shanghai after a recent corruption scandal.

Although competition between the pair cannot be reduced to a binary factional contest, Mr Xi is more closely associated with Jiang Zemin, the former president, and his growth model favouring coastal provinces and the private sector.

The policy implications of any leadership change depend in some respects on the personalities who rise to the top but even then they are difficult to tease out.

Even if he cannot secure the politburo line-up he wants, Mr Hu, with Wen Jiabao, the premier, has already recalibrated economic policy to focus more on the environment and social spending.

The impact of this policy change has been limited so far in an economy in which domestic demand still lags well behind the rate of growth in investment and exports. But Messrs Hu and Wen may be able to push their agenda more forcibly if they emerge from the congress with a more powerful internal mandate.