US Markets - A late rally sent stocks to a positive finish on Friday, ending a wild week with a wild trading day.

Stocks began Friday's session having fallen in six of the prior seven sessions as investors have fretted about whether consumers would succumb to higher energy prices, rising mortgage costs and an anemic Dollar. Continuing credit turmoil has also stirred concerns about the soundness of corporate balance sheets and profits.

A sharp rally Tuesday was largely undone by subsequent pullbacks; on Friday, the market appeared headed to another down day before the major indexes, which had flip-flopped all day, turned higher in the last half-hour.

Share prices fluctuated throughout the day, as investors digested a spate of earnings news both good and bad, and fell back into the standby routine of selling financial stocks and snapping up tech shares.

The major averages finished in positive territory after swinging between gains and losses for most of the day. The Dow Jones industrial average closed at 13,174, up 64 points, or 0.5%. The Standard & Poor’s 500 added 7 points, or 0.5%, to 1,458, while the Nasdaq gained 18 points, or 0.7%, to 2,637.

The Dow Transportation average tumbled 1.6%, falling 74 points to 4,563. The decline was sparked when FedEx revised its guidance early in the day. The shipping company said rising fuel costs and weak package volume will pressure its earnings and cut its fiscal second quarter and full-year 2008 outlook, and shares dropped $4.57, or 4.5%, to $96.80.

FedEx rival also closed with a loss Friday, down $1.09, or 1.5%, to $72.01.

Trucking company YRC Worldwide said it sees the same weak trends as FedEx. The company, which stopped offering guidance this year due to the difficulty in forecasting the market, saw its shares drop $2.52, to $17.59, down 12.5% Friday.

Crude prices added $1.67, to $95.10 per barrel on the New York mercantile exhange. The major US oil companies closed the day with gains as the commodity rallied. Dow component Exxon Mobil rose 44 cents, or 0.5%, to $84.93, Chevron climbed $1.82, or 2.2%, to $85.98, and ConocoPhillips shares added 89 cents, or 1.1%, to $78.93.

The topsy-turvy day on Wall Street mirrored the trends of the late summer and early fall, as financial stocks retreated and the tech sector charged ahead.

Financial firms declined after Fannie Mae said it has reworked the way in which it accounts for losses, an announcement that appeared to confuse investors and shake whatever confidence they had in the lender. Shares of Fannie dropped $2.35, or 5.5%, to $40.69.

On the tech side, the big names were leading the gains, as computer-maker Hewlett-Packard paced the Dow with a 3.8% gain. Shares of the company rose $1.85, to $50.75, after an analyst upgraded its shares. The gain by Hewlett Packard came after Morgan Stanley raised its rating on the computer and printer maker to Overweight from Equal-weight. Morgan Stanley attributed the upgrade to HP's more diversified revenue base, strong balance sheet and underappreciated software portfolio.

Among the biggest tech winners was Garmin, after the navigation equipment company announced it was withdrawing from the bidding for European digital map-maker Tele Atlas. The withdrawal, which basically ceded Tele Atlas to Garmin rival TomTom, was met with approval by investors. Garmin’s shares flew 16.1% higher, adding $13.51, to $97.51.

A majority of the Dow components ended the session in positive territory, contributing to the gain posted by the blue chip index. 

Dow components 3M, McDonald's, and Procter & Gamble also posted strong gains. Additionally, shares of Altria closed up 1.3% after reaching a record intraday high.

Meanwhile, shares of General Motors ended the session firmly in negative territory, limiting the upside for the Dow. GM closed down 2.9%, ending the session at a two-month closing low.

Other Dow components that posted notable losses include Citigroup, Honeywell, and Boeing. Shares of Boeing closed down 1.5%, at a seven-month closing low.

European Markets - European equities slumped for the third consecutive week as investors watched warily for signs that the credit crunch would spill over into the wider economy and moved into defensive stocks.

The FTSE 300 Eurofirst dropped 1.2% over the week to 1,494.12.

So let's take a closer look, country-by-country and start with Germany where in Frankfurt German shares closed slightly lower after calm Friday trade, led down by Infineon, after several negative broker notes today and yesterday ignited a sell-off of shares in the company.

The DAX was down 54.77 points, or 0.71%, at 7,612.26 after trading between a high of 7,655.96 and a low of 7,564.66.

The MDAX fell 103.85 points, or 1.06%, at 9,671.87 while the TecDAX retreated 28.50 points, or 2.94%, at 940.02.

DAX futures won 22.00 points, or 0.30%, at 7,653.00 while bund futures retreated 0.16 points, or 0.14%, at 114.42.

Leading blue chips lower, Infineon slumped 0.95 Eur or 10.44% at 8.15.

Goldman Sachs reduced its price target for Infineon to 12 Eur per share from 13 Eur, while reiterating its 'buy' rating. Exane BNP Paribas dropped its target to 7.7 Eur per share from 10.2, while reiterating its 'underperform' rating, and Unicredit reduced its target to 10.5 Eur from 13.5, keeping its 'hold' rating.

Hypo Real Estate was down 1.31 Eur or 3.46% at 36.52 as traders pointed to continued pressure on financial stocks, with UK bank Northern Rock in focus, as today is the deadline for proposals regarding the future of the ailing mortgage bank.

Peer Commerzbank dropped 0.55 Eur or 2.09% at 25.73, while Deutsche Bank lost 1.29 Eur or 1.51% at 84.06.

Recent pressure continued for shares in Continental as the tyre and autoparts specialist dropped 2.34 Eur or 2.51% at 91.92.

Deutsche Post shares fell 0.27 Eur or 1.20% at 22.17, reversing earlier gains, after US Peer FedEx Corp lowered its earnings expectations for the fiscal second quarter and full year, citing soaring fuel costs and a troubled US freight market.

Bucking today's negative trend, Deutsche Boerse was 3.05 Eur or 2.65% higher at 117.98.

Deutsche Postbank added 1.50 Eur or 2.93% at 52.69, to lead a group of 10 advancers, after Bear Stearns started Germany's largest retail bank with an 'outperform' rating and a 63.5 Eur target, seeing the bank as 'under the radar' in so far as the credit crunch is concerned.

German retailers and consumer goods stock also saw advances after several brokerages talked of increased domestic personal spending forecasts which could benefit the companies.

Metro shares were 1.77 Eur or 2.84% higher at 63.19.

Shares in Henkel added 0.22 Eur or 0.58% at 38.30 after the household goods company announced it will be raising its prices on adhesives, sealants and surface treatment products in response to continuing rising raw material costs.

In addition, the trader pointed to projected strong domestic spending levels as a driver for the share.

RWE gained 1.86 Eur or 2.13% at 89.16, after the utility's defensive qualities churned up demand.

Shares in TUI rebounded from severe losses yesterday, gaining 0.15 Eur or 0.76% at 20.01.

Over on the MDAX, KUKA led decliners, losing 2.21 Eur or 7.42% at 27.59 as traders spoke of vague rumours of a large placement.

IKB Deutsche Industriebank was down 0.76 Eur or 5.80% at 12.35 after a report in the Frankfurter Allgemeine Zeitung said the bank is facing further potential losses of around 300  million Eur, citing banking sources.

Sueddeutsche Zeitung reported in a pre-release of an article to be published tomorrow that the bank plans to pass on loans of up to 1  billion Eur and related customers to Deutsche Postbank until March 2008 in an attempt to improve its balance, citing IKB internal documents.

At the other end of the mid-cap index, Krones added 1.92 Eur or 3.52% at 56.42.

TecDAX-listed Tele Atlas was 2.88 Eur or 8.97% lower at 29.34 as the index's worst performer after Garmin withdrew from the bidding war for the Dutch digital mapmaker, thwarting hopes that TomTom would need to raise its bid.

At the other end of the index, QSC outpaced a group of four advancers, up 0.11 Eur or 4.38% at 2.65.

Over to France now where in Paris Share prices ended lower as renewed concerns of an economic slowdown weighed on cyclical stocks, while banks were hit by fresh fears about subprime fallout, with Dexia suffering most after its third quarter results, market sources said.

The CAC-40 index finished down 37.50 points or 0.67% at 5,523.63.

Among CAC-40 stocks, 13 closed higher and 27 closed lower. On the Matif, November CAC-40 futures were trading at 5,543.5.

On the broader indices, the SBF-80 index closed down 119.98 or 1.85% at 6,360.31 and the SBF-120 ended 33.82 or 0.84% lower at 4,004.98.

The Euro was at 1.4634 usd compared to 1.4636 usd late yesterday.

After a tentative rally earlier this week, today's losses meant the CAC-40 was virtually unchanged versus last Friday's close of 5,524.18, which followed a 3% plunge the week before.

Hesitant early trading on Wall Street today helped maintain the downward trend in Paris. US investors grew nervous after industrial production in October showed the sharpest decrease in nine months, while on the corporate side, FedEx Corp. lowered its earnings expectations for the fiscal second quarter and full year, while Starbucks Corp. slashed its earnings forecast for the fourth quarter after it reported lower traffic at comparable stores.

Franco-Belgian bank Dexia was the main bluechip casualty in Paris, falling 1.42 Eur or 7.36% to 17.87 after disappointing with third quarter figures this morning, which notably showed losses at its US credit enhancement business FSA and mark-to-market losses in treasury and market activities weighing on net profit.

Dexia dragged down other financials, with Societe Generale shedding 2.73 or 2.60% to 102.27, Credit Agricole dropping 0.52 or 2.19% to 23.27, and BNP Paribas down 1.24 or 1.71% at 71.46.

Credit Agricole was also impacted by a downgrade from UBS, which cut its stance on the banking group to 'neutral' from 'buy' saying Wednesday night's results raised more questions than it gave answers.

Elsewhere in the CAC-40, fears of an economic slowdown continued to weigh on cyclical stocks such as autos, with Michelin falling 2.98 or 3.61% to 79.47, Renault slipping 2.50 or 2.58% to 94.46, and Peugeot down 0.90 or 1.61% at 54.84.

Alstom saw further profit-taking, giving up 5.19 or 3.54% to 141.45, while property group Unibail-Rodamco was also affected by jitters around cyclicals, slipping 5.87 or 3.94% to 143.11.

Air France-KLM also saw profit-taking after rallying by nearly 10% during the first three sessions of the week.

The airline declined to comment on a statement from EUclaim, a firm set up to fight for passenger compensation, that it is looking to see if there are grounds for claims arising from the recent strike at Air France.

Shares in British Airways fell in London after The Times reported that it faces a multi-million-Pound compensation bill after failing to keep secret a deal in which it agreed to pay two passengers 430 stg each for cancelling their flights.

Outside the CAC-40, a number of shares were hit by weak earnings publications. Zodiac fell 1.86 or 4.17% to 42.75 after the aerospace components maker reported full-year net profit at the lower end of expectations and warned earnings per share may fall in the year to Sept 2008.

A Paris-based dealer said the share is also reacting to concerns about the Dollar/Euro exchange rate, as Zodiac is particularly sensitive in this area.

Sodexho Alliance was further penalised by yesterday's below-consensus full-year earnings figures, shedding 1.91 or 4.40% to 41.51.

In a research note this morning, Credit Suisse cut its stance on the catering and services group to 'neutral' from 'outperform' after cutting its earnings per share estimates for 2008 and 2009 in the wake of yesterday's results.

CGG Veritas also extended its post-earnings losses, falling 14.04 or 6.99% to 186.96 after giving up over 6% yesterday. Merrill Lynch downgraded the seismic services group to 'neutral' from 'buy' after yesterday's third quarter results which came out below analyst estimates.

Yacht builder Rodriguez Group also took a battering, falling 3.77 or 11.97% to 27.72, after its sales for its year to September revealed weak revenues from sales of second-hand boats.

On the upside, Vallourec enjoyed gains as it was once again the focus of speculation. Certain dealers pointed to talk of a major buyer of call options, with a strike price of 240 Eur. Others said they were hearing rumours of a takeover bid to be launched this weekend, at a price of 260-280 Eur per share.

The seamless-tube maker added 4.09 or 2.11% to 198.19, well below its earlier high of 205 Eur.

Among other risers, defensive stocks were once again in favour in today's bear market, with telecom and food-related stocks performing well.

Food manufacturer Groupe Danone headed the CAC, up 1.35 or 2.28% at 60.56, with France Telecom, 0.50 or 1.97% higher at 25.94 and food retailer Carrefour, up 0.72 or 1.45% at 50.32, not far behind.

Utilities similarly benefited from the move to defensive stocks, with Gaz de France up 0.49 or 1.28% at 38.83, Veolia Environnement adding 0.68 or 1.06% to 64.67, and Suez 0.46 or 1.02% higher at 45.64.

Elsewhere, Sanofi-Aventis pared morning losses that followed the publication of studies in the UK pointing to risks of depression among patients taking the company's rimonabant anti-obesity drug.

Sanofi-Aventis, which closed down 0.31 or 0.51% at 59.99, said the studies did not add any new information, adding that 'the extrapolation of certain data appears to us to be the sole result of the authors' opinion.'

Neighbours Belgium saw the Brussels market lower at the close, with UCB tumbling after the European Medicines Agency (EMEA) rejected its application to sell Crohn's disease drug Cimzia in the EU and Dexia sharply lower as the market reacted negatively to the group's third quarter results.

The Bel 20 closed 46.20 points or 1.12% lower at 4,060.71.

UCB dropped 4.45 Eur or 12.05% to 32.47 as KBC Securities lowered its target price for UCB on the news to 42 Eur from 46, while maintaining its 'accumulate' rating, and Bank Degroof lowered its fair value price to 42 Eur from 50, maintaining its 'buy' rating.

Financial heavyweight Dexia lost 1.49 Eur or 7.72% to 17.81 after it published third quarter results which showed a sharp decline in net profit due to a 121.8  million usd loss posted by its US subsidiary FSA, and a 74  million Eur mark-to-market loss (MTM) at treasury and financial markets.

The share dropped sharply after the results were disclosed, but analysts at Nataxis, Petercam and Rabo Securities told clients they believed the share price reaction to the group's results was 'overdone'.

Bank Degroof upped its rating on the financial services group to 'buy' from 'accumulate', saying today's sharp share price fall following the release of third-quarter results creates an 'excellent buying opportunity'.

Fortis fell 0.52 Eur or 2.80% to 18.03.

Peer KBC dropped a more modest 0.42 Eur or 0.46% to 90.60.

At the other end of the index, Belgacom rose 0.79 Eur or 2.39% to 33.84 and Delhaize gained 1.30 Eur or 2.25% to 59.10.

ABN Amro upgraded the supermarket group to 'buy' from 'hold' following its continued robust US performance, while reducing its target price to 65 Eur from 69 on cut FY forecasts.

Suez added 0.53 Eur or 1.17% to 45.64.

Outside the Bel 20, Kinepolis lost 0.99 Eur or 2.30% to 42.13.

After the market closed, the cinema group said it expects annual visitor numbers for 2007 to be 'somewhat below those for 2006', without providing further details.

The company said this is 'mainly as a result of the mediocre range of films on offer until mid-May and the warm weather, particularly in April.'

Pro-forma full-year visitor numbers for 2006 were 21.6  million, excluding the outsourced Kinepolis Poznan unit.

GIMV was down 0.43 Eur or 0.91% at 46.60.

Earlier it said it is buying an 80% stake in the Lintor/Verbinnen group, Belgium's leading processor of chicken products.

Barco was 0.91 Eur or 1.80% lower at 49.60 at the close.

The group sad earlier today that it has secured a contract to supply six additional LED screens for use at the Olympic Games in Beijing.

Shoe retailer Brantano edged 0.02 Eur or 0.04% lower to 54.12 after posting in-line third quarter figures last night.

ING raised its full year guidance for the group.

Innogenetics closed flat at 6.25 as KBC cut its target price to 5.80 Eur from 6.00 on yesterday's 'disappointing' Q3, and cut its EPS forecast to minus 0.43 Eur from minus 0.23 for 2007, and to 0.32 Eur from 0.38 for 2008.

Into The Netherlands now where Shares in Amsterdam closed sharply down on a negative Wall Street, while TomTom bucked the trend, after Garmin dropped its bid for Tele Atlas, allaying fears TomTom would have had to raise its own bid to keep up.

The AEX closed down 6.70 points or 1.32% at 500.08, after opening at 500.81 and reaching a late afternoon low of 496.92. A problem at NYSE Euronext led to the opening level being disclosed only at midday.

TomTom was the exception of the day, soaring almost 6% to 60.15 after Garmin dropped its bid for Tele Atlas, paving a smooth path for TomTom. Tele Atlas closed down 8.63% to 29.27.

Other gainers on the AEX included Hagemeyer, 0.65% higher to 4.63, Unilever, lifting 0.92% to 24.22 and Wolters Kluwer, putting on 0.92% to 21.88.

The AEX was broadly in the red, with staffing companies still taking the brunt after Adecco received a statement of objections alleging violations of competition rules. Vedior closed down 5.37% to 12.69 with SNS Securities saying the company's French unit Vedior France will also likely get such a statement, with negative sentiment passing on to all peers active in France. Randstad was off 4.24% to 30.52. Midcapper USG People was 2.35% lower to 17.48, a bit heartened by reports saying the issue will move up to the AEX next year.

Corporate Express was another strong decliner, sliding 5.01% to 6.45 amid concerns regarding US retail sales, which would affect Corporate Express, a local trader said.

Among techs, ASML was off 1.54% to 22.35 and Philips lost 3.34% to 28.10. Midcapper Oce weakened 4.69% to 12.19 and LogicaCMG was 3.61% lower to 1.87.

Fortis weakened 2.86% to 18.02 after Dexia released third-quarter results below analyst expectations and failed to reassure concerned investors about the sector's sub-prime exposure.

Among other financials, Aegon lost 2.32% to 12.63 and ING slipped 2.43% to 26.15.

Royal Dutch Shell was off 0.33% to 27.26 after staying in positive territory most of the day following remarks given by Algerian Energy Minister Chakib Khelil at the OPEC summit, that oil prices would remain at current levels until the end of the first quarter of next year, but would not breach 100 usd. Also, Shell's spin-off Avantium postponed its IPO due to bad market conditions.

Ahold was still outperforming the market, down 0.30% to 9.88 after the company appointed John Rishton as its new CEO and Kimberly Ross as the new CFO.

Heineken was off 0.22% to 45.0 Eur, also outperforming the general market after it and Carlsberg urged Scottish & Newcastle shareholders to consider their raised offer for the UK brewer and tell management to cooperate with the due diligence process. The consortium stressed that their bid's pre-conditions were not 'extensive', as charged by S&N, and that their offer would unlock value for S&N shareholders.

On the midcap, Crucell was down, falling 5.93% to 11.26, after it and DSM Biologics signed a PER.C6 license agreement with Daiichi Sankyo. Crucell declined to provide any financial details surrounding the deal.

Midcap gainers included Corio, up 0.81% to 53.76 on reports the issue will be included in the AEX at the next re-weighting.

Heijmans added 0.79 at 24.28, Stork put on 0.22% to 45.10 and Wessanen, lifted 0.45% to 11.15.

Axross to Austria now where in Vienna Shares closed lower, led by BWIN, mirroring a general retreat in the gaming sector, A-TEC Industries, after its target price was greatly reduced by a broker today and Andritz sharply down on profit-taking.

The ATX was down 0.51% or 22.4 points at 4,411.14. The ATX Prime was 0.43% or 8.87 points lower at 2,076.75.

Engineering conglomerate Andritz led the index losers in terms ofpercentage, closing 5.44% lower at 38.44 Eur, sold down in very late trading on profit-taking after gaining on the back of a rating upgrade to 'buy' by Erste Bank yesterday.

Dragged lower for the second day, BWIN continued to be pressured by third-quarter results yesterday, which surprised, showing a downturn in customer numbers. BWIN was down 4.71% at 22.03 Eur at the close.

Shares in A-TEC Industries AG closed 3.63% lower at 103.89 Eur and continuing the descent started at the beginning of the week.

Today, analysts at Deutsche Bank cut their target price to 138 Eur from 188 on the back of unexpected charges in the industrial companys third-quarter results posted yesterday.

Ironically, having hit an all-time high of 194.31 Eur in June this year, A-TEC is now trading around its issue price of 96 Eur when first listed at on Dec 1 a year ago.

Tracking the downturn in airlines stocks as a result of strong fuel prices, Austrian Airlines fell 4.76% to 6 Eur.

This morning, Austrian Airlines said load factor for the month was 76.4%, up on 75.4% a year earlier.

Also lower on profit-taking after gains on account of solid third quarter results on Wednesday, Wiener Staedtische dropped 1.53% to 48.25 Eur.

Earlier, analysts at Citigroup upped their rating on the insurance company to 'buy' from 'hold' and raised the target price minimally to 60 Eur from 57.

Strabag fell 3.03% to 48 Eur, Wienerberger slipped 3.58% to 37.16 Eur and In line with broad declines in banking sector shares, Erste Bank retreated 0.95% to 48.85 Eur, while peer Raiffeisen International last dealt up 1.57% at 103.80 Eur, thanks to its minimal ABS exposure.

In an unexplained late rally, Intercell shares closed 3.66% higher on the day at 26.32 Eur The vaccine company will publish results for the third quarter on Monday.

Observers accredited the strength in RHI, which closed up 1.34%, to bargain-hunting after the share had around 17% pared off its value over the past month as a consequence of recent market turmoil.

OMV last traded flat on the day at 50.50 Eur, having remained mostly in positive territory for the session, thanks to a reaffirmed 'buy' recommendation by brokers at Oppenheim and the expectation that high oil prices will continue right through the fourth quarter.

Skipping next-door to Switzerland now where in Zurich Swiss share prices closed sharply lower, weighed down by financials, with little inspiration from Wall Street, which slipped into negative territory on concerns that the Federal Reserve may stop cutting interest rates.

The Swiss Market Index ended the week 114.85 points or 1.3% lower, at 8,478.80, while the Swiss Performance Index was down 90.20 points or 1.3% at 6,928.81.

The Euro fell slightly against the Swiss franc to 1.6362 SFr, while the Dollar also dropped to 1.1179 SFr.

Banks were once again under pressure, with UBS down 1.60 SFr or 2.9% to 52.95 and rival Credit Suisse closing 1.45 SFr or 2.1% lower at 67.10.

Julius Baer was also lower, falling 0.65 SFr to 90.45.

The luxury goods sector, too, slipped.

Richemont outperformed the market, but failed to gain, closing 0.15 SFr lower at 73.00. It earlier posted expectations-beating first-half performance.

Swatch was also lower, down 4.50 SFr or 1.3% to 330.25.

Meanwhile, pharmaceutical giants declined.

Roche ended the week 1.90 SFr lower at 198.40 SFr. Earlier it said its Avastin drug has received a positive opinion in Europe for first-line treatment of patients with advanced kidney cancer.

Peer Novartis fell 0.45 SFr to 59.15.

Nestle, which Thursday provided some support to the SMI, did not do so Friday. It fell 3.00 SFr to 547.50.

Adecco tumbled to the bottom of the SMI, down 2.05 SFr or 3.1% to 63.85.

Swisscom was at the other end of the chart, closing as the day's only gainer, up 2.00 SFr at 415.25.

Outside the SMI, StarragHeckert was sharply higher, up 35 SFr or 4.7% at 780, on the back of its strong nine-month results.

Donning winter jackets now, we head into Scandinavia and start with Norway where in Oslo Share prices closed lower, led down by Norske Skog on reports its biggest private shareholder wants the paper company to halve its Norwegian workforce, and by Marine Harvest, while Eastern Echo was higher on a raised bid from Schlumberger.

The OSEBX Benchmark index closed 6.55 points lower at 478.96 and the OSEAX All Share index fell 7.29 points to 559.41.

Total turnover amounted to 12.82  billion NKr.

Norske Skog closed 2.95 NKr lower at 37.25 after the paper company's largest private shareholder, Emil Aubert, told daily Dagens Naeringsliv the group should should cut its workforce in Norway by half in its struggle against a Europe-wide paper oversupply and falling prices.

Yara International rose 0.25 to 186.

Marine Harvest shed 0.15 to 4.1. Carnegie repeated its 'outperform' on the stock following the very weak third-quarter result, while DnB NOR Markets cut its target price to 4-4.5 from 5.5.

Marine Harvest posted an operating loss of 22.3  million NKr, down from a pro forma profit of 764.5  million and compared with analysts' expectations of a profit nearer to 300  million NKr. The group has been struggling against falling salmon prices, fish illness in Chile, and other adverse currency effects and one-off items.

Photocure added 0.4 to 45.9. The pharmaceuticals group has decided to demerge its PCI Biotech unit, and list the cancer-focused drug delivery subsidiary on the Oslo Stock Exchange. Photocure shareholders will receive one share in PCI for every share they own in Photocure.

AGR Group fell 0.65 to 49.6, reversing earlier gains that came after the group won a StatoilHydro contract extension, taking contract value to 147  million NKr from 87  million previously.

Odfjell Invest was down 0.5 at 15.8 after reporting operating and pretax losses in the third quarter.

Aker Kvaerner fell 4.5 to 170.25. The group won two contracts to supply equipment to China National Offshore Oil Corporation (CNOOC). Contract values were not disclosed, but according to a report in the Chinese media, the value of the contracts were 50  million usd.

Aker Yards shed 1.5 to 84.25. The European Commission said the deadline for its inquiry into South Korean shipbuilder STX Shipbuilding's proposed 800  million usd acquisition of a 39.2% stake in Norwegian shipyard Aker Yards is set for Dec 21.

Norsk Hydro was 1.5 lower at 75.5.

Eastern Echo added 1.2 to 14.8 after US group Schlumberger increased its offer to buy Norwegian seismic explorer Eastern Echo to 15 NKr a share, up from 12 NKr previously, and said it now controls 55.6% of Eastern's equity.

'Based on 15 NKr a share, the new offer represents a premium of 97% over the IPO price at the end of October 2007,' Schlumberger said.

Eastern's management dismissed the original Schlumberger offer as 'too low', arguing that a price of 20 NKr per share would be a fairer valuation.

TGS-Nopec Geophysical was 0.6 lower at 80.7. It has secured a new pre-commitment contract of about 40  million usd for the company's first wide-azimuth multi-client 3D survey in the Mississippi Canyon and Atwater Valley areas of the Gulf of Mexico.

Seismic peers Petroleum Geo-Services shed 7.25 to 145.25, while SeaBird added 0.6 to 20.1 and EMGS rose 3.5 to 82.

StatoilHydro was 1.5 lower at 168.1 on the weak crude oil prices following yesterdays US oil inventories, dealers said.

Deutsche Bank upgraded StatoilHydro to 'buy' from 'hold' and upped its target 200 NKr from 185 in an integrated oil note.

Frontline fell 0.5 to 212.5 after missing consensus with its third-quarter results and its warning that a weaker market will continue into the fourth quarter.

Carnegie reiterated its 'outperform' recommendation on the stock on the back of hopes for a strong tanker market in 2008-09.

Seadrill shed 3 to 114.25. The group won a one-year extension to an existing rig contract with Total, worth an additional 45  million usd. The continuation of the contract is expected to keep the unit employed until May 2009.

DnB NOR was down 0.7 at 85.2 after Belgian peer Dexia posted third-quarter results showing a sharp decline in net profit.

Storebrand fell 1.3 to 69.4.

Telenor added 0.5 to 128, while Orkla fell 0.1 to 97 and Renewable Energy Corporation ended the session down 10 at 261.

In Finland Helsinki shares closed lower, with the broadly negative mood weighing on most blue chips, including industrial stocks.

The OMX Helsinki 25 ended down 1.05% at 3,106.56 and the OMX Helsinki all-share index was 0.99% lower at 11,714.77. Volume was 1.282  billion Eur.

Industrial shares were among the biggest fallers, with Outotec ending down 4.85% at 42.20 Eur, Outokumpu finished 2.15% lower at 22.35 Eur, Wartsila B was 1.25% weaker at 49.62 Eur and Metso shed 2.85% to 37.11 Eur.

Metso said it won an order to supply Finnish mining company Talvivaara with an automation system, but did not divulge its value.

Other major fallers were Nokia, down 0.99% at 26.01 Eur; Amer Sports A, off 2.80% at 37.18.4060 Eur; and OKO Bank, down 3.04% at 12.45 Eur.

Gains in some stocks supported the main indices, with Fortum finishing up 0.62% at 29.31 Eur, while in telecoms Elisa was 2.00% firmer at 21.45 Eur and paper company Stora Enso R closing up 0.54% at 11.17 Eur.

Elsewhere, Ahlstrom closed 0.59% lower a 16.75 Eur.

Ahlstrom said it will expand one US production plant but close two others this year and next to cut fixed costs.

Over in Denmark , Copenhagen Share prices closed lower, led down by ALK-Abello on disappointing results of a US study of its Grazax allergy tablet, by shipping stocks on weaker freight rates, and by Vestas Wind Systems.

The OMXC20 index closed 8.03 points lower at 473.89 and the OMXCB Benchmark index fell 9.28 points to 448.26.

The OMXC All Share index closed 7.42 points lower at 458.77 on turnover of 4.52  billion DKr.

ALK-Abello B closed 342 DKr lower at 630 after the Danish pharmaceuticals group said a US phase III clinical study of its grass pollen allergy treatment Grazax did not meet the primary endpoint.

However, an analysis in a subset of patients did show a positive clinical effect and partner Schering-Plough will continue the development programme and will conduct an additional one-year study in 2008.

Genmab fell 8.5 to 310. The group announced 'encouraging' pre-clinical data for its antibody HuMax-IL8, a drug candidate previously known as HuMax-Inflam and which may have potential to treat cancer.

Genmab said HuMax-IL8 was shown to affect tumour vascularisation and suppress tumour growth in the study.

Coloplast rose 3.5 to 469. The group is expected to post full-year operating profit of 1.043  billion DKr on Tuesday, up from 955  million a year ago, analysts polled by RB-Boersen said.

Novo Nordisk B shed 14 to 620 and Lundbeck fell 1 to 147.

Shipping stocks were hit by weaker rates, with AP Moller-Maersk A falling 700 to 65,700 and the B-shares shedding 800 to 66,500.

DS Norden was 21 lower at 536.

DS Torm fell 4.25 to 195.75. Analysts polled by RB-Boersen see the group posting third-quarter pretax profit of 41  million usd on Thursday, down from 73  million a year ago, on sales of 233  million usd, up from 159  million. The quarter has been hit by weaker freight rates, analysts said.

Vestas Wind Systems was 25 lower at 446 on sector rotation that has hit technology and industrial stocks, dealers said.

The wind turbine maker will invest in technology and quality-enhancing initiatives to face growing competition as the alternative energy market grows, Vestas group chief executive Ditlev Engel told Thomson Financial News.

Vestas expects a tenfold increase in wind power's share of total energy output to 10% by 2020. While some analysts have described the vision as overly optimistic, Engel said the interest in wind power is growing rapidly, in part driven by higher fuel prices.

William Demant Holding fell 5.5 to 438.5 and GN Store Nord was down 1.1 at 40.

Bang & Olufsen was up 7 at 537 on reports that Merrill Lynch upped the stock to 'buy'.

Carlsberg B rose 1 to 648. Late in the session, the Carlsberg-Heineken consortium claimed that the board of Scottish & Newcastle is preventing the delivery of 'certain cash value' to its shareholders by refusing to facilitate the consortium's pre-conditions in its bid for S&N.

The consortium reiterated yesterday's statement dismissing claims from S&N that its offer is 'highly conditional', instead describing its bid pre-conditions as 'limited and customary', as well as waivable by the consortium.

This came in response to reports stating it will only make a recommended takeover offer for S&N.

JP Morgan Chase cut its target price for the Carlsberg shares to 765 DKr from 780 DKr, and Carnegie said the Carlsberg-Heineken 750 pence per share bid for Scottish & Newcastle is still value-creating for the Danish brewer.

Royal Unibrew was 4 higher at 524, recovering from sharp losses earlier this week following weak third-quarter figures and a cut in full-year outlook.

Danisco shed 4.5 to 383. According to daily Berlingske Business, the group sees only the top five players surviving next year's consolidation of the European sugar industry.

Novozymes fell 16 to 517.

Danske Bank was down 2.75 at 205.5 after Belgian peer Dexia posted third-quarter results showing a sharp decline in net profit

Jyske Bank fell 3 to 397.5.

TrygVesta was up 4.5 at 391.5. Analysts polled by RB-Boersen expect the group's nine-months net profit to come it at 1.845  billion DKr next Friday, compared with 2.092  billion a year ago. Pretax profit is seen falling by 36  million DKr to 2.425  billion, while gross premium income will rise by 2.2% to 12.3  billion DKr. The weaker result derives from the insurer's investment portfolio, the analysts said.

Topdanmark rose 9 to 752. FLSmidth shed 11 to 470.

Rounding out Scandinavia this week is Sweden where in Stockholm Stockholm shares closed slightly down, coming off day lows in the final hour of a volatile session, with bargain hunting among engineers being countered elsewhere amid fears that the crisis in credit markets is not yet over.

The OMX Stockholm index closed down 0.56% at 354.81, while the OMX Stockholm 30 finished 0.54% lower at 1,096.69. Turnover amounted to 26.633  billion SKr.

Index heavyweight Ericsson B closed down 2.36% at 18.22, after reports that the company had won a large order in China proved to be inaccurate.

Hennes & Mauritz B closed down 0.49% at 407.50. Carnegie said after Hennes & Mauritz's 'solid' October sales data yesterday, that the focus will shift to the Q4 numbers, which should be very strong.

Engineering stocks benefited from some bargain hunting after recent sharp losses. Sandvik closed up 2.53% at 111.50 in heavy trade, while SKF B closed down 0.68% at 108.75, Alfa Laval up 1.71% at 387, and Atlas Copco A up 3.29% at 94.25.

SCA B closed up 3.07% at 109.25, after being mentioned as being analysts' favourite share in a Dagens Industri report.

The banks suffered further losses on continuing concern over international credit markets.

Swedbank A closed down 0.55% at 181, and Handelsbanken A down 0.26% at 193.50, and Nordea down 0.47% at 105.60.

SEB A closed down 0.89% at 167.50. SEB said it signed an agreement to acquire 97.25% of the Ukraine's Factorial Bank, for around 116.7  million usd.

SEB said it has an option for the remainder of the shares, and that the acquisition is in line with its strategy to expand its footprint in Eastern Europe through organic growth and add-on acquisitions.

The truckers also had a difficult session with Volvo B closing down 3.16% at 107.25 and Scania B down 2.71% at 143.50.

Saab B closed down 3.00% at 129.50. Saab's 7  billion SKr radar order from Pakistan could be delayed if political situation in country doesn't improve, with Saab now restricting travel to and within the country (Dagens Industri).

Among other shares heavily traded, Boliden closed down 3.53% at 88.75, SSAB A down 1.82% at 161.50, and TeliaSonera up 0.41% at 61.75.

Jackets off and down to warmer weather now and starting in Greece where Athens shares closed slightly lower and recovered from heavy losses incurred earlier in the session, following Wall Streets higher open.

The ASE general index ended 0.4% lower at 5,096 and the blue chip index slid 0.3% to 2,701.6. Mid caps lost 0.3% to 6,391.8 and the small cap index rebounded to close 0.9% higher at 1,050.3.

Advancers outnumbered decliners 135 to 119 while 74 were unchanged in below the average trading volume of roughly 383  million Eur.

Bank of Piraeus closed 1.3% lower at 25.98 Eur. Yesterday it announced that it is participating in the privatization of Ukrainian bank KreditProm with a non-binding offer.

Real estate company Lamda Development plummeted 3.9% to 12.68 Eur after it said that its net profits fell 48.1% year-on-year to 24  million Eur on one-offs booked in 2006.

Marfin Popular Bank led blue chip decliners throughout the session and dropped 3.1% to 9.88 Eur on continued profit taking while the National Bank of Greece recovered from recent falls and closed 1.5% higher at 45.9 Eur.

Renewable energy company Terna gained 0.7% to 13.6 Eur on UBS raising its target price to 17.8 Eur from 16.5 Eur and keeping its buy rating on account of the recent listing of its energy unit Terna Energy. Terna Energy fell 1.3% to 10.36 Eur.

Furniture and sports retailer Fourlis fell 1.2% to 26.8 Eur after Citigroup cut it to hold from buy on account of its year to date rally considering that the stock should pause for breath.

Cosmetics and goods wholesaler Sarantis jumped 2.1% to 12.5 Eur ahead of its nine month results announcement on Monday. A Thomson Financial News analysts consensus poll sees its nine month net profits growing 3.7% year-on-year to 16  million Eur.

Hellenic Telecomms (OTE) closed 1.2% lower at 25.46 Eur. It announced it has raised its stake in mobile operator Cosmote to 85.18% from 84.51% via market purchases yesterday. Cosmote ended flat at 26.26 Eur.

ATEBank gained 0.5% to 3.86 Eur. Its nine-month group net profit is seen jumping 83% year-on-year on trading gains and retail lending volumes when it announces its results on Wednesday Nov 21.

Neighbours Italy saw Milan Share prices close flat, with investors uncertain on the next direction of the market, with gains in BMPS after recent hefty falls offsetting Impregilo on worries of a construction sector slowdown.

The Mibtel index was up 0.04% at 29,735 points and the S&P/Mib gained 0.23% to 38,535.

Volume traded was an estimated 5.982  billion Eur.

Brokers said the economic slowdown being seen in US, parts of Europe and Japan will be partly offset by emerging economies, which continue to grow.

On the positive side was BMPS, up 3.43% at 3.7525 Eur. Reports said bank officials have been touring Europe to promote its recent 9  billion Eur acquisition of Banca Antonveneta, judged expensive by analysts.

The BMPS share had fallen sharply on the Antonveneta deal, half of which will be funded by a rights issue. Today, BMPS's majority shareholder, the MPS foundation, said it will underwrite the 4.5  billion rights issue.

Mediobanca added 2.58% to 16.47 after the MPS foundation said it has taken a 1.9% stake in the investment bank.

Banco Popolare extended recent losses, down 2.47% at 14.34, as brokers continued to downgrade its prospects. Both Merrill Lynch and Dresdner Kleinwort cut their earnings estimates on the bank.

BPM gained 0.58% to 10.45. Reports say it will take at least another month to examine a possible merger with Credit Mutuel.

Unicredit lost 1.80% to 5.515.

Energy stocks were mixed with utilities benefiting from the economic uncertain. Snam RG rose 1.54% to 4.43. Oils were mixed with Eni up 2.72% at 24.20 and Saipem down 3.70% at 27.35.

Impregilo lost 4.08% to 4.3425. Cement stocks were mostly lower on the economic slowdown. Italcementi fell 2.77% to 13.26 and Buzzi Unicem was down 0.03% at 19.04.

Tenaris gained 2.16% to 16.40, benefiting from the merger speculation on sector peer Vallourec.

Telecom Italia gained 1.36% to 2.17, off its high on reports that hedge funds are mulling a break up plan.

Fiat was down 3.18% at 19.46. Yesterday, CEO Sergio Marchionne gave investors in London a lorry and car product order update.

In Portugal , Lisbon Shares closed lower in light, volatile trade as EDP retreated from earlier gains, and BES, BCP and construction stocks also weighed, while PT and retailer Jeronimo Martins rose.

The PSI 20 index closed down 36.85 points at 13,085.49 after trading in a range of 13,057-13,159 on a volume of around 205  million Eur.

PT was up 0.09 Eur at 9.44, though off an intra-day high of 9.49, tracking strength in its European telecoms peers. Market sources cited the company's buyback programme, solid third-quarter results earlier this week and flurry of price target rises as driving the stock.

EDP fell 0.04 to 4.72, but off a high of 4.84. Earlier Exane lifted its target price for EDP to 5.58 Eur per share from 5.18, with its 'outperform' stance reiterated, on higher valuations for the group's renewables unit and Spanish distribution business.

Retailer Jeronimo Martins climbed 0.16 or 3.09% to 5.34, as traders said they expect positive newsflow from the company's investor day in Poland next Friday, as well as from Ahold's results next Wednesday regarding the potential sale of its stake in JMR to joint-venture partner Jeronimo Martins.

Brisa gained 0.04 to 10.09, retreating from earlier losses as a sector source said Brisa's forecast for toll revenue growth of 9.6% in 2008 from a year earlier at its investor day today looks lower than expected at first sight.

Traders said the market expects news on the identity of the buyers of a 5% block trade of Brisa shares on Tuesday.

In the banking sector, BES fell 0.20 to 15.63, and BCP was 0.02 lower at 3.07, while BPI gained 0.03 to 5.49, recovering from earlier losses.

Conglomerate Sonae closed unchanged at 2.07, retreating from earlier gains as analysts deemed positive the cash-settled equity swap deal with Banco BPI, saying it shows Sonae's management is confident in its share price.

Constructors extended yesterday's losses, with Mota Engil down 0.06 at 5.45 and small cap Soares da Costa slipping 0.03 to 2.22.

And last but by no means least this week in Europe, we head to Madrid where Spain 's main bourse closed higher driven by heavyweights Santander and Telefonica after a positive November futures expiry on the IBEX-35 index, with Bankinter soaring on M&A speculation, while Gamesa plummeted after nine month results.

The IBEX-35 index ended up 43.20 points at 15,769.90, after trading in a range of 15,560-15,826.

The November future on the IBEX-35 index expired at 15,744, up 0.17%, on volume of about 40,000 contracts.

Heavyweights ended higher in heavy futures-driven trade, with Santander up 0.04 Eur at 14.78 on volume of 82.5  million, and Telefonica gaining 0.25 to 22.86 on volume of 48.8  million.

Bankinter was the session's star performer, climbing 0.94 or 8.46% to 12.05, with dealers citing short-covering after a week of M&A speculation, with rumours circulating that Ram Bhavnani could sell its 15% stake on Monday.

'It looks like something's going to happen, and no one wants to be left behind when a deal finally does come through,' a trader a leading US bank said.

Also in the M&A spotlight, Iberia added 0.02 to 3.67, extending yesterday's gains triggered by news of a 3.6-3.9 indicative bid from a consortium led by Gala Capital.

Energy issues were also firm, with Fenosa up 1.15 or 2.52% at 46.86, Enagas gaining 0.47 or 2.42% to 19.91 and Gas Natural 0.96 or 2.27% higher at 43.26.

Gamesa bucked the trend, shedding 1.85 or 5.67% to 30.79, after the company posted uninspiring nine month results and warned of bottleneck supply risks for its wind turbine business in the fourth quarter.

UK Market - The rally in the share price of Kingfisher, owner of the B&Q DIY chain, came to a halt Friday after its broker said there was a chance of a dividend cut next year.

Kingfisher has risen 12% since announcing the resignation of Gerry Murphy, its chief executive, at the start of the month.

It fell 5.2% to 173.6p Friday after UBS warned a downturn in the UK housing market would put Kingfisher’s dividend at risk. “We believe the chance of a dividend cut is now more than 50-50 and thus formally forecast a cut from 10.6p to 6.5p for the 2008-09 payment, a decline of 40%,” analyst Andrew Hughes said.

Leading shares were dragged down by further weakness in the banking sector. The FTSE 100 finished 68.4 points, or 1.1%, lower at 6,291.2, leaving the index down 13.7 points, or 0.2%, over a volatile week. The FTSE 250 fell 135.4 points, or 1.2%, to 10,766.2. Over the week the mid-cap index lost 93 points, or 0.85%. Alliance & Leicester led the market lower. Shares in the mortgage lender fell 6.3% to 607p amid concerns about rising funding costs and talk it would issue a trading update next week.

On Friday, the three-month interbank Sterling rate was set at 6.39%, up from 6.34% on Thursday, and its highest level since September 19.

That rise weighed on the rest of the banking sector. Barclays fell 4.1% to 509p, HBOS eased 3% to 759½p and Royal Bank of Scotland fell 4.9% to 426½p.

RBS was also unsettled by a note from Credit Suisse that drew attention to a drop in third-quarter profits at Citizens, its US subsidiary.

After a gloomy report from the Royal Institution of Chartered Surveyors Land Securities fell 2.1% to £14.69, Hammerson, dipped 2.5% to 974p, and British Land, shed 2.5% to 889½p. British Land was also downgraded by Lehman Brothers. Taking its rating to “equal-weight” from “overweight”.

Compass, the contract caterer, lost 4.6% to 287½p as the market reacted to Thursday’s earnings miss from French rival Sodexo Alliance, which was blamed on rising food prices. Traders fear that Compass could spring a nasty surprise when it reports full-year results on November 28.

Rio Tinto hit £56.20 in morning trading as rumours circulated that rival BHP Billiton, up 4p to £16.02, was set to increase the terms of its offer to 3.5 BHP shares for every Rio share.

Traders were sceptical, citing rumours that Goldman Sachs had hosted a lunch with hedge funds and BHP management to discuss the existing offer Friday. Rio shares closed 0.7% lower at £53.80.

J Sainsbury rose 2% to 413½p in spite of news that Lord Sainsbury of Turville had reduced his stake to 6.3% from 7.7%. Traders noted that the stock had actually been sold this time last year through a derivatives contract that was settled Friday.

The day’s other risers were mainly defensive stocks such as Scottish & Southern Energy, up 2.2% to £16.25, and British American Tobacco, 0.9% stronger at £18.18.

Among mid-caps, rumours of a takeover approach pushed Hunting, the oilfield services company, up 1.9% to 713½p.

A Credit Suisse upgrade helped insurer Beazley Group rise 6.7% to 155¼p.

Japan & Asia Pacific - Shares tumbled across the Asia-Pacific region on Friday as the possibility of higher interest rates in China increased, the Yen strengthened and the Bank of Japan’s deputy governor worried publicly about the effect of a US housing recession and financial market turmoil on his country’s economy.

It’s exactly the same thing we’ve been seeing over the past few weeks, we see the US taking a beating and Asia - with many countries being US and US Dollar-linked - is unable to decouple.

In Tokyo Japan ese shares closed lower on Friday as a stronger Yen and concerns about the US economy dented sentiment.

The Nikkei 225 Stock Average fell 241.69 points or 1.6% to 15,154.61. The blue-chip index was down 2.8% over the week.

The broader TOPIX shed 27.19 points or 1.8% to 1,471.67, and lost 2.2% during the week.

Decliners outnumbered gainers 1,409 to 253, with 55 issues unchanged.

Volume traded reached an estimated 1.83 billion shares, down from 1.93 billion shares on Thursday.

As selling overseas increased, market conditions here also deteriorated. Investors feel reluctant to buy shares because of lingering uncertainties over the US subprime loan problems.  Resolving the subprime loan problem with rate cuts looks to be impossible.

Japan's financial markets will be closed next Friday, Nov 23, due to a national holiday, shortening the trading week when US housing data and Japanese banks' results are due for release.

Exporters came under heavy selling pressure, with Toyota Motor Corp down 110 Yen or 1.7% at 6110 Yen as the market found little comfort in a Nikkei report that the carmaker plans to reduce the weight of its midsize passenger cars by 10% to improve fuel efficiency by around 3%.

Sony Corp and Canon Inc both lost ground, with Sony down 60 Yen or 1.1% at 5,350 Yen, and Canon down 70 Yen or 1.3% at 5,500 Yen.

Hong Kong shares closed sharply lower on Friday, hit by a double whammy of a possible economic slowdown in the US and China's attempts to curb fund inflows into the city.

The Hang Seng index tumbled 1,136.78 points or 4.0% to close at 27,614.43. The index shed over 1,000 points or 4.1% this week after losing 5.5% last week.

Turnover was 138.30 billion Hong Kong Dollars.

Hong Kong-listed shares of Chinese companies, or H-shares, plunged on reports that the authorities in Shenzhen, just across the mainland border, are moving to limit cash withdrawals from bank accounts in the city to prevent the alleged illegal flow of mainland funds into Hong Kong.

China is trying to get a better handle on money going out of the country and Shenzhen is the main exit point for fund outflows. Sometimes money is even carried physically from a border town in Shenzhen, which falls both in Hong Kong and the mainland.

The Hang Seng China Enterprises index plunged 747.73 points or 4.3% to 16,737.73.

South Korean shares closed lower Friday, although the losses were pared in late trade when bargain-hunters returned to the market to pick up oversold machinery and shipbuilding stocks.

The KOSPI index closed down 21.54 points or 1.1% at 1,926.20, after trading between 1,890.25 and 1,928.93. It ended the week with a 3.2% loss.

The index is now about 160 points below its record intra-day high of 2,085.45 reached on Nov 1.

Trading was thin. Volume reached 300 million shares worth 6.3 trillion Won.

Decliners beat gainers 497 to 306, with 69 issues unchanged.

Foreign investors were net sellers of shares worth 462 billion Won and retail investors were net buyers of 265.6 billion Won worth. Institutions were net buyers of 86.1 billion Won worth.

Machinery and shipbuilding stocks ended higher or at least trimmed earlier losses.

Doosan Heavy edged up 500 Won or 0.4% to 138,500 Won, while Hyundai Heavy shed 2,000 Won or 0.4% at 468,000 Won, after falling as low as 436,500 Won.

Shipping stocks advanced on renewed hopes that demand will remain strong until 2010, with STX Pan Ocean rising 20 Won or 0.5% to 4,040 Won.

Domestic-demand-linked shares rallied. They are considered relatively safe from the US credit troubles. Lotte Shopping rose 1,000 Won or 0.3% to 406,000 Won and KT&G, a tobacco company, climbed 500 Won or 0.7% to 77,300 Won.

Most technology counters retreated. Samsung Electronics fell 13,000 Won or 2.3% to 557,000 Won and LG Electronics slid 5,200 Won or 5.0% to 98,800 Won.

Hyundai Motor was off 3,000 Won or 4.1% at 70,000 Won, ending a two-session rally.

China A-shares closed lower led by bank and property stocks, with investors worried about a possible hike in interest rates and fresh speculation about taxes on gains from stock transactions.

The State Administration of Taxation said individuals with annual personal income above 120,000 Yuan must declare gains on stock and property investments from Jan 1. The move has been interpreted by some investors as preparation for a new tax.

The benchmark Shanghai Composite Index lost as much as 2.62% in late trade, before it narrowed its losses, boosted by energy stocks led by PetroChina.

The index closed down 48.99 points or 0.91% at 5,316.27. It was up 0.01% for the week.

Trading was sluggish with turnover falling to 61.64  billion Yuan, the lowest in four months, from 80.95  billion in the previous session,

Property developers retreated. Shenzhen Overseas Chinese Town Holding Co Ltd tumbled 5.90 Yuan to 60.10.

China Vanke Co Ltd lost 1.19 Yuan to 34.30, and Poly Real Estate Group Co Ltd fell 3.72 Yuan to 80.00.

Industrial and Commercial Bank of China shed 0.12 Yuan to 8.24, and Shenzhen Development Bank Co Ltd lost 1.90 Yuan to 38.60 .

PetroChina Co Ltd added 0.91 Yuan to 38.82. It will join major indices in Shanghai and Shenzhen on Monday, becoming the biggest stock with over 20% weighting in the Shanghai Composite Index.

China B-shares also closed lower led by property stocks. The Shanghai B-share Index fell 3.14 points or 0.92% to 337.53 on turnover of 400.87  million usd and the Shenzhen B-share Index closed down 9.25 points or 1.29% at 707.45 on turnover of 316.08  million hkd.

China's two largest property developers led the declines in Shenzhen.

China Merchants Property Development Co Ltd slid 1.91 hkd to 39.59 and China Vanke Co Ltd fell 1.13 hkd to 21.00.

In Shanghai, Shanghai Zhenhua Port Machinery Co Ltd shed 0.096 usd to 2.708.

Shanghai Jinqiao Export Processing Zone Development Co Ltd lost 0.035 usd to 1.748.

The FTSE/Xinhua China B 35 Index was down 173.57 points at 11,420.14.

Philippine shares finished a turbulent week with further losses Friday after a selloff on Wall Street sparked by concerns about the US economy spooked investors, sending the key index to more than six-week lows.

The Philippine central bank's decision Thursday to cut key interest rates by another 25 basis points failed to stir excitement, as the move was widely expected.

The composite index fell 73.26 points or 2% to 3,598.96, just off the day's low of 3,595.13. It was the index's weakest level since Oct 1 when it settled at 3,597.92. It was down 2.8% for the week.

The broader all-share index lost 37.72 points or 1.7% to 2,210.30.

Decliners overwhelmed advancers 101 to 17, while 41 stocks were steady.

A total of 3.8 billion shares worth 5.3 billion Pesos were traded.

The market spent the entire session in negative territory with the selling pressure intensifying in the last hour of trading. Even property developers were not spared.

Megaworld Corp, the country's second-largest home builder, fell 20 centavos or 4.8% to 3.95 Pesos.

Metropolitan Bank & Trust Co, the nation's largest bank by assets, slumped 2.50 Pesos or 4.5% at 53.50 Pesos.

Philippine Long Distance Telephone Co, the nation's biggest company by market value, retreated 35 Pesos or 1.2% to 3,015 Pesos, snapping a three-day rise.

Geothermal power producer PNOC Energy Development Corp was a standout as it bucked the trend. The stock rose 10 centavos or 1.4% to 7.20 Pesos on its first day as a constituent of the 30-company main index.

Food and beverage group San Miguel Corp's A-shares, limited to local investors, fell 1.50 Pesos or 2.8% to 51.50 Pesos. Its B-shares, open to foreigners, slipped 2.50 Pesos or 4.6% to 51.50 Pesos.

In Taiwan , Share prices closed lower following a negative lead from Wall Street and on worries that weaker US consumer spending could affect Taiwan's exports growth.

Taiwan relies heavily on exports and US consumption, with the consumer electronics sector particularly dependent on supplies to the world's largest economy.

Sentiment was also weighed down by political uncertainties as Taiwan's high court is set to rule later this afternoon on an appeal by the mayor of the southern city of Kaohsiung, Chen Chu, after her election was annulled for breaking campaign rules.

Kaohsiung's district court in June ruled in favor of the opposition Kuomintang's Huang Chun-ying, who sued Chen for falsely claiming he had bought votes in the election.

Chen, of the ruling Democratic Progressive Party, beat Huang by 379,417 votes to 378,303 in December of last year.

The weighted index closed down 140.59 points or 1.58% at 8,764.82, after trading in a range between 8,678.55 and 8,790.57.

Turnover was 113.83  billion twd. For the week, the index gave up 206.10 points, or 2.30%.

The local bourse hit an intraday low for the week at 8,599.39 points on Tuesday.

Decliners outnumbered advancers today 1,545 to 561, with 296 stocks unchanged.

A total of 11 stocks closed limit-up, while 15 were limit-down.

The cement sector was down 4.54%, steel fell 3.71%, petrochemicals lost 3.18%, electronics declined 1.34% and financials dropped 0.80%.

The construction sector was up 0.14%.

Uni-President Enterprises Corp closed down 0.75 twd or 1.58% at 46.85 despite a report that its China operations have secured approval from the Hong Kong stock exchange for a listing there.

China Steel Corp shed 1.85 twd or 4.21% to 42.05, failing to respond to news that it has suffered less than its peers from hikes in transportation costs, noting that about 75% of its transport requirements can be handled by its own shipping fleet.

Asustek Computer Inc rallied 1.50 twd or 1.49% to 102.00 on the back of a report that it sold over 10,000 units of its low-cost 'Eee' compact laptop in the US two weeks after its launch.

Chunghwa Picture Tubes Ltd lost 0.40 twd or 3.48% to 11.10 despite a reported order from Innolux Display Corp. Innolux shed 6.50 twd or 5.33% to 115.50.

Quanta Computer Inc was 0.10 twd lower at 52.00, failing to respond to a report that it and the Massachusetts Institute of Technology are jointly developing virtual computers.

Taiwan Semiconductor Manufacturing Co Ltd was down 0.40 twd at 60.50 although it bought back 14.48  million of its shares at an average price of 61.13 twd per share yesterday.

Among other stocks in focus, United Microelectronics Corp lost 0.15 twd to 19.20; High Tech Computer Corp fell 13.00 twd or 2.05% to 622.00; and Taiwan Cement Corp lost 2.65 twd or 5.40% to 46.45.

Meanwhile, Shin Kong Financial Holding Co Ltd gained 0.45 twd or 1.69% to 27.05, and Radium Life Tech Co Ltd advanced 1.20 twd or 5.44% to 23.25.

Malaysian shares closed lower Friday with sentiment dented by an extended fall on Wall Street overnight.

The Kuala Lumpur Composite Index (KLCI) closed down 3.36 points or 0.2% at 1,386.64.

For the week, the KLCI was down 15.61 points or 1.1%.

The FTSE Bursa Malaysia 30-large cap index fell 24.61 points or 0.3% to 8,759.10 and the second board index lost 32.26 points or 0.5% to 7,066.19.

Decliners outnumbered advancers 534 to 291 with 278 stocks unchanged and 231 untraded.

Trading volume was1.01 billion shares, valued at 1.82 billion Ringgit.

Maybank closed down 10 sen or 0.9% at 11.30 Ringgit as investors cashed in gains in late trade. Malaysia's largest bank by assets reported a 29% rise in first-quarter net profit as provisions for bad loans dropped.

State-run Telekom Malaysia was unchanged at 10.90 Ringgit and national power company Tenaga was flat at 8.95 Ringgit.

IOI Corp, Malaysia's most valuable palm oil company, rose 5 sen or 0.7% to 7.50 Ringgit. The company said Thursday first-quarter net profit jumped 77%, aided by record crude palm oil prices.

Hap Seng Plantations jumped 41 sen or 15.5% to 3.06 Ringgit on its trading debut on the main board. Hap Seng Plantations is the second largest palm oil producer in Malaysia in terms of yield.

National carmaker Proton Holdings was higher following a report it has struck a deal to form a partnership with Germany's Volkswagen AG. The stock traded up 8 sen or 1.6% at 5.00 Ringgit.

At the close, the Ringgit was quoted at 3.3790/3840 against the Dollar. Three-month interbank rates were quoted at 3.55/58% and the overnight rates were at 3.48/50%.

Indonesian shares closed sharply lower Friday as renewed selling on Wall Street and on regional markets sparked profit taking on the strong rally of the past two days.

Key decliners included large-cap banks as investors doubt that the central bank, Bank Indonesia, will cut its key rate again this year amid rising inflationary pressure from a high oil price.

The composite index closed down 37.12 points or 1.4% at 2,668.70 on volume of 2.74 billion shares worth 4.81 trillion Rupiah.

For the week, the index lost 1.4%.

The LQ45 index was down 9.50 points at 585.34.

Decliners led advancers 137 to 48, while 60 stocks were unchanged.

The Rupiah was trading at 9,320/9,325 to the Dollar, little changed from 9,315/9,325 late Thursday.

The country's largest bank Bank Mandiri lost 75 Rupiah or 2.1% to 3,475 Rupiah, Bank Central Asia dropped 150 Rupiah or 2.1% to 6,950 Rupiah, Bank Rakyat Indonesia fell 200 Rupiah or 2.5% to 7,750 Rupiah, Bank Danamon shed 50 rupaih or 0.6% to 8,750 Rupiah, and Bank Negara Indonesia dropped 40 Rupiah or 2.1% to 1,890 Rupiah.

Among other losers, index heavyweight Telkom dropped 150 Rupiah or 1.4% to 10,500 Rupiah, coal giant Bumi Resources lost 225 Rupiah or 4.6% to 4,600 Rupiah, and Astra International fell 500 or 2.1% to 23,550 Rupiah.

Singapore ended down also Friday, in line with other Regional bourses.

The benchmark Straits Times Index closed down 36.63 points or 1.1% at 3,440.96 after trading between 3,405.86 and 3,453.98 points. It lost 158.71 points or 4.4% for the week.

Decliners outnumbered gainers 615 to 230, with 1,902 stocks unchanged.

Volume was relatively small compared to previous sessions at 1.8 billion shares valued at 2.1 billion Singapore Dollars.

The index may be poised for a technical rebound next week as investors are likely to start picking up bargains stocks.

CapitaLand slipped 15 cents to 6.80 Dollars, City Developments was 10 cents lower at 14.10 Dollars and Keppel Land declined 10 cents to 7.85 Dollars.

Allgreen Properties added 5 cents to 1.50 Dollars after turning out as the top bidder for a prime residential site in the central business district. The Urban Redevelopment Authority said the company made a top bid of 180.80 million Singapore Dollars for the site.

Most banking stocks turned higher on positive earnings outlook. United Overseas Bank added 10 cents to 19.60 Dollars and Oversea-Chinese Banking Corp gained 5 cents to 8.45 Dollars. DBS Group, meanwhile, fell 30 cents to 19.50 Dollars.

Singapore Airlines slipped 40 cents to 17.90 Dollars after reporting late Thursday a minimal increase in its overall load factor in October.

Palm plantation owner Wilmar International shed 24 cents to 4.60 Dollars after Lehman Brothers cut its rating on the stock to 'equal weight' from 'overweight' after the recent run-up due to firm crude palm oil prices.

Indian shares shrugged off an unexpected rise in domestic inflation and the steep drop in share markets across Asia to close only slightly lower after a volatile session.

India's wholesale price index rose to 3.11% in the week ended Nov 3 from 2.9% the previous week. The inflation rate came in at the highest level in 5 weeks but is still comfortably below the central bank's target of 5%.

The Bombay Stock Exchange's benchmark Sensex opened about 200 points lower on weak global cues but recovered as the session progressed and eventually closed only 86.53 points or 0.44% lower at 19698.36. The National Stock Exchange's S&P CNX Nifty closed 0.09% lower at 5906.85.

For the week, the Sensex has gained 790.76 points, while the Nifty rose 243.6 points.

Stocks of companies with lower market capitalisation continued to score impressive gains on sustained buying by domestic investors. The midcap index ended 1.17% higher at 8512.38, while the smallcap index rose 1.5% to 10380.73.

Diversified conglomerate ITC Ltd rose the most on the Sensex, surging 8.17% to close at 205.15 Rupees, just slightly off its new 52-week high of 208 Rupees hit earlier Friday.

Profits were booked across sectors, with Hindalco Industries losing the most. The scrip fell 5.52% to 203.80 Rupees, after hitting a new 52-week high of 223.30 Rupees yesterday.

Larsen & Toubro which fell about 3% to 4375.85 Rupees a day after the heavy engineering major said it has, in consortium with Luxembourg-based Paul Wurth, bagged a 5.8- billion-Rupee order from Steel Authority of India Ltd.

Pharmaceutical giant Ranbaxy Laboratories fell 2.82% to 411.70 Rupees amid reports it will recall 73  million Gabapentin pills after finding impurities in the nerve treatment tablets that were above specified limits.

Down under to Australia now where Australian shares closed lower Friday in volatile trading amid expectations the downward trend on Wall Street would continue later Friday.

The S&P/ASX 200 closed down 66.7 points or 1% at 6,461.9, off its low of 6,449.9 and high of 6,527.7. For the week, the benchmark index was down 83.8 points or 1.3%.

The All Ordinaries was 68.3 points or 1% lower at 6,526.1.

The S&P/ASX 200 December futures contract fell 79 points to 6,501.

Volume traded was 1.58 billion shares worth about 6.39 billion Australian Dollars. Decliners outstripped gainers 717 to 516, with 374 stocks unchanged.

The yield on the 10-yield bond eased 0.08percentage point to 6.02% while the yield on 90-day bills rose 0.033percentage point to 7.17%

The market was largely weighed down by the financial and resources sectors.

Among the major banks, National Australia Bank fell 1.84 Australian Dollars or 4.2% to 42.16 Dollars after going ex-dividend, and Australia & New Zealand Banking Group dropped 44 cents or 1.6% to 27.70 Dollars. Westpac lost 23 cents or 0.8% to 27.99 Dollars.

Emerging iron ore miner Fortescue Metals Group fell 2.70 Dollars or 4.4%, giving back some of yesterday's gains, after applying to the National Competition Council for third-party access to rail lines owned by BHP Billiton and Rio Tinto in Western Australia.

Fortescue wants open access to Rio Tinto's Hamersley Iron rail line and BHP Billiton's Goldsworthy rail line to allow the development of its iron ore deposits in the Pilbara region.

Rio Tinto fell 3.38 Dollars or 2.5% to131.21 Dollars and BHP Billiton was unchanged at 41.15 Dollars, amid speculation Rio Tinto is planning to make an unwanted counterbid for BHP Billiton. Rio Tinto has rejected a three-for-one share offer from BHP Billiton on the grounds it is too low.

Volatility is expected to remain a key theme next week as the fallout from the subprime mortgage crisis and concerns about the health of the US economy keep investors on edge.

New Zealand share prices closed little changed Friday, shrugging off weakness in overseas markets as investors focused on local developments, including bids for Auckland International Airport.

The benchmark NZX-50 index rose 1.13 points to close at 4,114.18, on turnover worth 138.5 million New Zealand Dollars.

Auckland International Airport fell three cents to 3.01 Dollars, after the Canada Pension Plan Investment Board (CPP) submitted its formal cash bid for a 40% stake at 3.6555 Dollars a share.

The airport company said it has asked its advisers to seek other offers.

Fisher & Paykel Appliances rose four cents to 3.64 Dollars, gaining a total of about 30 cents since releasing its first half results last week.

The company is considering selling its finance company to focus on its whiteware manufacture and retailing business.

That could add a lot of value to shareholders if there was a sale of their finance arm, and it would allow Appliances to free up more cash to concentrate purely on their core business.

Market leader Telecom rose four cents to 4.25 Dollars after falling nine cents Thursday, second-ranked Fletcher Building was up eight cents at 11.66 and Contact Energy lost five cents to 8.85.

Fisher & Paykel Healthcare was up three cents at 3.28 Dollars, Sky City gained five cents to 5.37, Sky TV lost eight cents to 5.62 and Vector closed up three cents at 2.33.

Air New Zealand, which has been weak recently because of rising fuel prices, rose one cent to 2.02 Dollars.

Commodities - Highly volatile trading was a key feature of commodity markets this week, which saw a correction for gold while oil faltered in its challenge for the $100 mark.

Nymex December West Texas Intermediate rose $2.04 to $95.47 a barrel, helped by short covering ahead of the contract’s expiry Friday, while January WTI gained $1.97 to $94.04 a barrel. For the week, December WTI slipped 0.9%.

ICE January Brent rose $1.32 to $91.55 a barrel, down 1.8% this week.

As New York trading began on Friday, open interest in the December contract remained high with more than 100,000 contracts outstanding, setting the stage for another volatile session. Some traders holding short positions hoped selling pressure would increase after the holders of December options failed to push oil to $100 by the expiry on Tuesday. However, news that Hugo Chávez, Venezuela’s president, plans to develop nuclear power spooked traders on Friday and pushed oil higher.

WTI’s low point this week was $90.13 on Wednesday after Opec, the oil producers’ cartel, ruled out a supply increase at this weekend’s heads of state summit but left the door open for action in December.

US heating oil prices remained near record levels with stocks standing 25.2% below last year’s level. Nymex December heating oil rose just more than 4 cents to $2.60 a gallon on Friday, down 0.7% this week.

Gold rose 0.2% at $789.75 a troy ounce on Friday but lost 5% this week as speculators booked profits after amassing record long positions. At the RBC gold conference in London this week, Tony Fell, chairman of RBC Capital Markets, said that a renewed focus on gold as a store of value was inevitable in the face of rising levels of systemic risk across financial markets.

Platinum rose 1.3% to $1,446 this week. Johnson Matthey’s review predicted a supply deficit this year due to disruptions to South African production while demand is forecast to rise 2.9% to a record 6.925m ounces this year.

Fears that a large earthquake in Chile would cause significant disruptions to metals output ensured volatility for copper which gained 0.3% to $7,055 this week.

In Chicago, CBOT January soyabeans jumped 4.3% this week to $10.88 a bushel, a 19-year high, after China, the world’s largest importer, cuts its forecast for domestic soyabean yields. The latest weekly export sales report showed China bought 1.3m tonnes of US soyabeans last week, well above market estimates, and recent days have seen further significant orders totalling 336,000 tonnes.

CBOT December corn slipped 1.9% to $3.79½ a bushel this week in spite of evidence of robust international demand with 1.36m tonnes of US corn sold for export last week.

Currencies - Sterling slumped to its lowest level against the Euro for four and a half years this week as the Bank of England laid the ground for cuts in UK interest rates and warned about the prospects for the UK economy in light of the credit squeeze.

Mervyn King, governor of the Bank of England, said UK growth would slow down sharply next year.

The warning came after the Bank on Wednesday released its quarterly inflation report, which suggested UK interest rates, at 5.75%, would fall next year.

The central bank said UK inflation would remain on target even if it cut interest rates 50 basis points, as expected by the market.

On Thursday, figures showing a surprise drop in UK retail sales added to the pressure on the Pound, fanning expectations that the central bank might even be prompted to cut rates before the end of the year.

Over the week, the Pound tumbled 2.1% to £0.7171 against the Euro, lost 2.2% to $2.0460 against the Dollar and dropped 2.3% to Y226.00 against the Yen.

The Yen surged to an 18-month high against the Dollar as traders retreated from risky assets amid heightened nervousness over the state of the financial sector.

Analysts said sliding equity markets saw investors unwind carry trades, in which low-yielding currencies such as the Yen are sold to fund the purchase of riskier, higher-yielding assets elsewhere.

This pushed the Yen to a high of Y109.13 against the Dollar on Monday, its strongest level since May 2006.

Comments from Yasuo Fukuda, the prime minister of Japan, helped stem the Yen’s rise. He said the Yen was appreciating too fast and warned traders and investors not to make speculative moves on the currency. He also noted that investors should be careful to avoid intervention from the Japanese government.

Analysts said the Yen remained poised to strengthen further if the nervousness on financial markets continued.

Stress in the financial sector and what is euphemistically referred to as the ‘lack of visibility’ continues to dominate the capital markets. In the foreign exchange market it is expressed through the unwinding of short Yen and Dollar positions and long positions in higher yielding currencies.

Over the week, the Yen rose 0.2% to Y110.50 against the Dollar, climbed 0.4% to Y161.80 against the Euro and gained 2.6% to Y98.30 against the higher-yielding Australian Dollar.

The Dollar also received a boost, rising 0.2% to $1.4650 against the Euro, climbing 2.5% to $0.8890 against the Australian Dollar and 0.9% to $0.7570 against the New Zealand Dollar.

The Canadian Dollar fell 3.7% to C$0.9790 over the week as trade data showed that the US slowdown and strength of the loonie were taking hold.

South Africa's Rand gained over one% against the Dollar on Friday as the greenback came under pressure against a basket of currencies ahead of data in the US. The Rand was trading at 6.6800 against the Dollar, after firming to 6.67 earlier. It closed at 6.7440 in New York on Thursday.

And as always, closing out currencies this week we go to China where the RMB finished at 7.4257 to the Dollar on the over-the-counter (OTC) market, down from 7.4228 Thursday.

China - China’s commerce ministry warned on Thursday that a slowing US economy would trigger a drop in Chinese exports that would mark a “turning point” for China’s rapid economic growth.

A global economic slowdown stemming from problems in the US subprime mortgage market and the resulting credit squeeze “will be the biggest challenge to China’s economy next year”, a report from the ministry’s policy research department said.

The report is Beijing’s first public comment on what repercussions it expects from the global credit crisis and a sign that the government does not support the view that Asian growth has “decoupled” from the US. “If demand in the US drops further, Chinese exporters will be devastated by a rapid and continuous fall in orders,” the report said.

Exports account for more than a third of China’s economic growth and 10% of overall GDP, a radically different situation from just four years ago, when exports contributed nothing to headline growth figures.

The ministry’s report was pessimistic about the chances of avoiding a US and global slowdown, pointing out that although central banks in the US, Europe and Japan had taken numerous steps to alleviate the credit crisis, the situation had continued to deteriorate and “panic in the credit market remains”.

The US receives a fifth of all Chinese exports, making it the second-largest destination for Chinese-made goods after the European Union.

China’s central bank estimates that every 1% drop in US economic growth translates into a 6% fall in Chinese exports.

Exports to the US have slowed significantly since the start of the year, dropping from a 20.4% year-on-year rise in the first quarter to a 15.6% increase in the second. Growth fell to 12.4% in the third quarter following the eruption of subprime loan problems.

The ministry said a combination of falling US interest rates and rising Chinese rates was limiting Beijing’s ability to rein in soaring property and stock market prices and inflation was running at its highest level in a decade. It also noted that continued turmoil in global financial markets could encourage greater capital inflows to China, straining the country’s financial and regulatory system and increasing inflationary pressure.

While potentially devastating for Chinese exports, a US slowdown could help reduce China’s soaring trade surplus, which hit a monthly high of $27bn in October, having increased more than 59% to $212.4bn in the first 10 months from a year earlier.

*************************************************

Chinese investment in the first 10 months rose at the briskest pace in more than a year, cementing expectations that another interest rate is on the way, possibly as early as this weekend.

Capital spending in urban areas on fixed assets such as factories and roads increased 26.9% between January and October compared with the same period last year, the National Bureau of Statistics said.

It was the fastest pace since September 2006, eclipsing forecasts of a 26.3% rise and the 26.4% increase in the first nine months.

The central bank has already raised interest rates five times so far this year and ordered banks on nine occasions to hold more of their deposits in reserve instead of lending them out.

The authorities have been trying to cool over-investment in sectors such as steel, aluminium and high-end property for fear that excess supply will drive down profit margins and leave companies unable to service their debts.

The government has tightened land-conversion and environmental-protection rules, taking particular aim at industries that consume a lot of energy and spew out pollution.

Slower industrial output and export growth in October had prompted some economists to conclude that these measures might be starting to work. Friday’s investment report suggested they were not.

Investment in real estate, ferrous metals and non-metal minerals was faster in the first 10 months than in the first nine months. Moreover, the number of new projects increased by 26.5% in the January-October period, compared with 24.2% in the first nine months.