BOSTON (MarketWatch) -- An exchange-traded fund benchmarked to the Nasdaq-100 Index last week became the first broad-market ETF to rise above its April high, thanks to strength in its two largest holdings, Google Inc. and Apple Inc.

The outperformance of the technology sector during the rally since the beginning of September has pushed PowerShares QQQ  through $50 a share. The ETF has gained 19% during the ramp up.

PowerShares QQQ has jumped well ahead of other large ETFs tracking major indexes such as the S&P 500  and Dow Jones Industrial Average  in 2010. The ETF’s next big hurdle is around $55, which was the high from 2007 before the credit storm.

PowerShares QQQ provides liquid exposure to U.S. stocks with a tilt to the tech sector. Launched in 1999, it has an expense ratio of 0.2% and holds assets of nearly $22 billion. The ETF traded as high as $120 a share in 2000 before the tech bubble collapsed.

PowerShares QQQ vs. SPDR S&P 500 ETF

The fund has gotten a boost lately from Apple  and Google  .

Last week, shares of Wall Street darling Apple rose above $300 for the first time as customers continue to snap up iPads and the company’s other hot products. See full story on Apple clearing $300 a share.

However, Apple could be a double-edged sword for PowerShares QQQ if investors lose their enthusiasm for the stock best payday advance. With about 21% of its assets in Apple, the ETF’s fortunes are closely tied to the tech giant. Apple reports quarterly results on Monday. See Apple earnings outlook.

Google was the second-largest holding as of Oct. 15 at 4.7%. The stock rallied 11% Friday to close above $600 after the company reported third-quarter earnings that topped expectations. Read a story about Google’s earnings and stock reaction.

The upbeat results bolstered the tech sector and the Nasdaq-100 ETF ended the session with a 2% gain while the Dow finished in the red. PowerShares QQQ saw trading volume jump Friday to more than 100 million shares for the first time in October.

The portfolio is comprised of the 100 largest non-financial stocks listed on the Nasdaq and nearly two-thirds of assets are invested in the information-technology sector. For the three months ended Oct. 15, PowerShares QQQ was up 16.1%, compared with a 10.5% gain for the S&P 500, according to FactSet Research.

ETF Investing: Apple, Google push Nasdaq ETF above April high

NEW YORK (MarketWatch) — U.S. stocks retreated Thursday after a four-session streak of gains as weekly jobless claims proved disappointing and a separate report showed inflation remaining fairly tame in September.

“The economy should be able to support current fourth-quarter and early 2011 analysts’ earnings estimates. However, the economy still does not appear strong enough to add a meaningful number of jobs,” wrote Fred Dickson, chief market strategist at Davidson Cos.

S&P 500 (1 YEAR)

• Market Snapshot: U.S. stocks in focus • Today's biggest advancing, declining stocks • Sign up for free, breaking-news email alerts | Earnings, updates, warnings | Industries • Tech Stocks | Energy Stocks | Retail Stocks • Financials | Airline Stocks | Pharma and Biotech • Bonds | Oil news | Gold news • Currencies | Market Data | Economic Calendar • See all the latest markets video

After a four-session run-up, the Dow Jones Industrial Average   was lately down 45.1 points, or 0.4%, to 11,050.98, with 25 of its 30 components falling.

Bank of America Corp.  weighed most on the blue-chip index, off 5.9%, with its shares and those of other banks hit as analysts attempted to estimate losses related to the halt in home foreclosures. Read more about bank stocks.

Fast-food chain McDonald’s Corp. rose the most among the Dow industrials, its shares gaining 1.3%.

The S&P 500 Index   declined 7.82 points, or 0.7%, to 1,170.28, with telecom up the most and financials hit the hardest.

Notable movers included Apollo Group Inc., shares of which fell 26% after the operator of the University of Phoenix rescinded its outlook for fiscal 2011, pointing to scrutiny from regulators and a possible 40% drop in new students.

Other for-profit eductors were also hit, with shares of most suffering double-digit declines payday advances. Read more about the school stocks.

Poised for its first lower finish in six sessions, the Nasdaq Composite   shed 10.85 points, or 0.4%, to 2,430.38.

AOL, others explore bid for Yahoo

AOL and private-equity firms are exploring a bid for Yahoo, devising plans to marry two big Internet brands that both face steep challenges.

Yahoo Inc.   shares surged 3.6% after published reports said the Internet-search company could be an acquisition target of private-equity firms.

Rival Google Inc.   is scheduled to release its earnings report after the closing bell. Read about what’s expected from Google.

For every three stocks advancing, four fell on the New York Stock Exchange, where 482 million shares traded as of 12:30 p.m. Eastern time.

Stock indexes retreated after the government said its count of Americans filing initial applications for unemployment benefits climbed last week. Read more about jobless claims.

The increase in jobless claims helped push the dollar index  , a measure of the U.S. currency against those of six other nations, to its lowest level this year.

Dollar weakness helps drive the purchase of hard commodities, including gold and equities, “especially those offering a dividend yield above current interest rates,” noted Davidson’s Dickson.

Separately, the producer price index — a gauge of how much goods cost at the wholesale level — climbed 0.1% last month, excluding food and energy. Read more about the PPI.

Post-recession pressures stemming from excess capacity have kept a lid on most consumer prices, but the scenario might not continue, especially if the dollar continues to slide, said Dickson.

Market Snapshot: U.S. stocks retreat from recent gains

BERLIN — German exporters, already buoyed by demand in China, are profiting from a modest upswing in Central and Eastern Europe as well, as the economies there revive and banks slowly resume lending to companies, according to an influential industry group.

The East Committee, which seeks to promote German industry across Eastern Europe and the former Soviet Union, reported that exports to the region jumped 20 percent in the first half of this year, compared with the period in 2009.

Poland, which managed to escape the worst of the global financial crisis, pulled even farther ahead of Russia as Germany’s leading trading partner in this part of Europe, it said, expressing concern about Russia’s lack of progress.

“The majority of these countries have overcome the economic crisis, with the exception of Romania, Bulgaria and Croatia,” said Klaus Mangold, a former Daimler executive who has headed the East Committee for a decade.

Exports to emerging markets helped Germany, which has Europe’s biggest economy, pull out of its worst recession in decades, with unemployment dropping as several of the big carmakers resumed hiring. Analysts say Eastern Europe, which is so tied to Germany, is in a strong position to profit from such growth.

According to a recent report by the Vienna Institute for International Economic Studies, the region will have an average growth rate of 1 percent in 2010 that will speed up to 2.5 percent in 2011 and 3 online payday loan lenders.5 percent in 2012.

In the first six months of this year, total trade between Germany and all the countries of Eastern and Central Europe amounted to €102.9 billion, or $143.6 billion, up from €85.5 billion.

Exports from Germany to Poland rose 19.3 percent to more than €31.4 billion in the period. Exports to Russia also showed a strong turnaround, climbing 29 percent but remaining in second place, with €26 billion.

The latest data by the Vienna Institute show that exports are now about 80 percent to 90 percent of precrisis levels.

German economists and industry chiefs, however, are increasing concerned about the lack of progress in Russia, where President Dmitri A. Medvedev has repeatedly talked about plans to modernize and diversify the economy. There is a gap, Mr. Mangold said, between words and deeds, with Russia continuing to depend on oil and natural gas as the main driver of its economy.

The Russian economy is forecast to grow 4 percent this year. While that is high compared with E.U economies, Mr. Mangold warned that without modernization and a move toward diversification Russia would not be able to compete. He said he was optimistic, however, that after 17 years of negotiations, Russia might be ready to join the World Trade Organization during the summer of 2011.

Germany Benefits From Recovery in Eastern Europe

Hot News: Agency releases new Chukchi drilling assessment

HONG KONG (MarketWatch) — Most major Asian markets ended higher Monday, paced by mining and metals stocks.

The stock advances came in the wake of pre-weekend gains on Wall Street, as a much weaker-than-expected U.S. payrolls report for September spurred hopes that the Fed may launch a new round of quantitative easing to support the economy.

IMF criticizes currency fights

Officials from the International Monetary Fund expressed the need for cooperation between nations and discussed protectionist economic policies at their annual meeting in Washington.

“Once again the market viewed the disappointing nonfarm payroll data out of the U.S. on Friday night as a positive given the implications for more quantitative easing in November,” said David Taylor, markets analyst at CMC Markets in Sydney.

China’s Shanghai Composite Index  gained 2.5% and Hong Kong’s Hang Seng Index  expanded 1.2% to end at its highest closing level since June 2008.

Australia’s S&P/ASX 200  added 0.3%, South Korea’s Kospi fell 0.4%, Taiwan’s Taiex lost 0.8% and India’s Sensex  climbed 0.4% in afternoon trading.

Markets in Tokyo were closed for a public holiday.

Dow Jones Industrial Average  futures were up 19 points in screen trade.

The gains in Hong Kong came despite a Reuters report saying that China has lifted the proportion of funds that banks must set aside as reserves by half-a-percentage point to 17.5%. The tightening measure is temporary and will be in place for two months, the report said.

“This hike means that the People’s Bank of China will continue to focus on quantitative tools instead of rate hikes to manage liquidity and to control inflation,” BofA Merrill Lynch economist Ting Lu wrote in emailed comments.” See story on China’s reserve requirements

Shares of Bank of China Ltd.   climbed 0.5% and Industrial & Commercial Bank of China Ltd.   advanced 0.7%, underperforming the broader market in Hong Kong.

Chinese shares traded on mainland bourses extended steep gains from Friday, with coal and metals companies leading the way.

Jiangxi Copper Co.   and Yunnan Tin Co.  jumped by the day’s 10% limit, with Baoshan Iron & Steel  rising 4.7% and China Shenhua Energy   gaining 6.3%.

“Broad economic indicators are likely better-than-expected for the fourth quarter, boosting demand for metals and coal,” said Zeng Xianzhao, an analyst at Everbright Securities.

Mining and metals shares also gained elsewhere in the region, with BHP Billiton    rising 1.1% and Rio Tinto   climbing 0.7% in Sydney; Korea Zinc Co. adding 2.9% in a downbeat Seoul market; and Sterlite Industries  advancing 3.7% in Mumbai trading.

In Sydney, Fortescue Metals Group   spiked 7.8% on news that it has refinanced a series of senior notes by signing a new $2.04 billion bank facility it hopes will drive already outlined expansion plans.

“I think the biggest issue that offshore investors have at the moment is the Australian currency. Do they plough back into the Aussie market, having pulled out when the resources-super-profits tax was proposed and the Aussie dollar was 10% or 15% lower?” said RBS Morgans investment adviser Danny Dreyfus cheap pay day loans.

The Australian dollar has been flirting with parity over the past week, and Dreyfus said offshore views on the local currency will be important for the share market. The Australian dollar rose to a post-float high of 99.18 cents against the U.S. dollar last week, with traders saying it’s only a matter of time before it reaches parity.

In Seoul, technology plays were mostly lower as concerns over earnings for the third quarter weighed. Samsung Electronics , which last week delivered weaker-than-expected third-quarter operating profit guidance, fell 0.7%, while Hynix Semiconductor tumbled 4.9%.

Shinhan Financial  dropped 2.7% after the Financial Supervisory Service said Monday it intended to penalize Chairman Ra Eung-chan for illegally holding bank accounts that weren’t opened in his name. An official at the regulatory authority said they could issue a disciplinary warning, suspend Ra from office or recommend Shinhan to dismiss him.

S&P 500 (1 YEAR)

• Market Snapshot: U.S. stocks in focus • Today's biggest advancing, declining stocks • Sign up for free, breaking-news email alerts | Earnings, updates, warnings | Industries • Tech Stocks | Energy Stocks | Retail Stocks • Financials | Airline Stocks | Pharma and Biotech • Bonds | Oil news | Gold news • Currencies | Market Data | Economic Calendar • See all the latest markets video

Elsewhere in the region, New Zealand’s NZX 50 added 0.1% and Philippine shares fell 0.4%. By late afternoon, Singapore’s Straits Times Index rose 0.1%, Indonesian shares slipped 0.2% and Thailand’s SET Index rose 1.3%.

In foreign-exchange markets, the U.S. dollar came under renewed selling pressure as Friday’s weak jobs data heightened expectations the Fed will embark on a second round of quantitative easing as soon as its next meeting in November.

The dollar slipped to a 15-year low against the yen at ¥81.37 in early Asian trade, putting investors on alert for potential intervention by Japanese authorities. The dollar managed to recover some of its losses and was fetching ¥82.04, from ¥82.08 late Friday in New York. The euro, meanwhile, was at $1.3949 from $1.3929, and at ¥114.47 from ¥114.33 yen. Read Currencies column.

The International Monetary Fund’s annual meeting failed to ease recent currency battles, instead leaving the dispute to be taken up at a summit next month of the Group of 20 countries. Chinese central bank officials rejected calls for an international or regional currency accord. See story on yuan’s rise

Credit Agricole Corporate and Investment Bank said: “The outcome of the IMF meeting leaves things much as they left off at the end of last week. In other words there is little to stand in the way of further U.S. dollar weakness apart from the fact that the market is already extremely short U.S. dollars.”

Spot gold was at $1,348.90 per troy ounce, up $1.90 from Friday’s New York close. November Nymex crude-oil futures were up 24 cents at $82.90 a barrel on Globex.

Asian markets rise; Shanghai leads again

JOB LOSSES: A wave of government layoffs in September outpaced weak hiring in the private sector, pushing down the nation's payrolls by a net total of 95,000 jobs. It was the fourth straight month that the economy lost jobs. The unemployment rate remained stuck 9.6 percent.

PRESSURE'S ON: The report is the final one before the November midterm elections. Voter frustration over jobs threatens to cost Democrats control of the House and perhaps the Senate quick pay day loan.

LITTLE IMPROVEMENT IN SIGHT: With economic growth weak, economists worry the jobless rate will rise and could reach 10 percent by next year.

Summary Box: Economy loses 95K jobs last month

Hot News: RI Dem Caprio blasts Chafee on taxes in gov race

Filed at 12:34 p.m. ET

BRUSSELS/LONDON (Reuters) - A European Union tax on bank profits and remuneration could raise as much as 25 billion euros (21.92 billion pounds) annually for cash-strapped governments to repair their economies, the bloc's executive said on Thursday.

The European Commission was outlining its ideas for a Financial Activities Tax (FAT), saying banks were "under taxed" and should contribute to rebuilding economies they damaged.

Tax is a matter for national governments in the EU and it is unclear if any activities tax will be introduced; talks between governments on any EU-wide tax could take years to bear fruit.

The Commission also backed a tax on financial transactions such as stock and bond trades, as called for by Germany and France.

The idea, often referred to as a "Tobin Tax" after the U.S. economist James Tobin who proposed it in the 1970s, should only be introduced on a global basis so as to avoid business shifting elsewhere, EU Tax Commissioner Algirdas Semeta said.

Semeta said the impact of taxes, along with global moves to beef up bank capital and introduce a possible surcharge on big banks, should be studied for their cumulative impact first.

EU states including Britain and Germany are planning a national levy on bank balance sheets to pay for future bailouts and Semeta said all the bloc's tax moves should be coordinated to avoid overlaps.

"We have to be cautious and prudent in calibrating a proposal," Semeta told a news conference.

EU finance ministers and leaders will discuss Semeta's ideas later this month ahead of "policy initiatives" next year. EU leaders agreed in June the bloc should lead efforts to set a global approach for introducing systems for levies and taxes on banks.

The Association for Financial Markets in Europe (AFME) said the financial sector remains a major contributor to tax revenues through corporate and employment taxes on the hundreds of thousands of people that it employs.

"Tax is not a regulatory tool and it should not be used as a substitute for effective financial regulation," an AFME spokesman said.

European banking shares appeared unfazed with the Stoxx banking index in line with the broader market.

Insurers said they should not pay an activities tax as they were not a cause of the financial crisis no fax cash advance.

"Any kind of cross-subsidisation of other financial sectors is inappropriate and could create moral hazard," Michaela Koller, director general of the European insurance federation (CEA) said.

GLOBAL TRANSACTION TAX

Semeta said an activities tax would make the sector more stable, raise more revenue and tax financial services more fairly as they are largely exempt from value added tax.

An FAT on total remuneration and profit could raise 25 billion euros for a tax rate of 5 percent, the Commission said. One industry publication has calculated that European banking profits totalled $130 billion in 2009.

Prime Minister David Cameron said on Wednesday the government was "sorting out the banks" to encourage lending to small businesses. A government source said this was a warning to banks that they should boost lending or face a tough response, possibly in the form of a FAT on profits and remuneration.

The International Monetary Fund proposed a FAT earlier this year to the Group of 20 (G20) leading economies which has agreed in principle that banks, and not taxpayers, should pay for rescues in future.

Kay Swinburne, a member of the European Parliament from Cameron's party, welcomed the Commission's view that a transaction tax should not be introduced unilaterally in the EU.

Green Party MEP Sven Giegold criticised the Commission for not proposing an EU transaction tax, saying the executive was "rehashing flawed old arguments."

Semeta said if a global transaction tax was levied on stock and bond trades at 0.1 percent, it could raise 60 billion euros towards development or climate change goals.

But earlier this year after opposition from the United States, the G20 shelved the idea of a common global transaction tax, saying each country should decide how it wanted to make banks pay for bailouts.

Last week, European Central Bank President Jean-Claude Trichet warned that going it alone with a transaction tax was not advisable.

EU Executive Lays Out 25 Billion Euro Bank Tax Idea

Filed at 11:59 a.m. ET

NEW YORK (Reuters) - U.S. stocks extended gains on Tuesday, with the S&P 500 holding above a key technical level after encouraging U.S. services sector data and moves by central banks to stimulate the global economy.

* The S&P 500 was at its highest level since mid-May on an intraday basis and above a recent resistance level of 1,150.

* The Dow Jones industrial average gained 159.84 points, or 1.49 percent, to 10,911 payday loan no faxing.11. The Standard & Poor's 500 Index rose 20.57 points, or 1.81 percent, to 1,157.60. The Nasdaq Composite Index jumped 48.49 points, or 2.07 percent, to 2,393.01.

(Reporting by Leah Schnurr; editing by Jeffrey Benkoe)

Corrected: Wall St Rises 1 Percent After ISM Data, BofJ Move

Filed at 5:38 p.m. ET

NEW YORK (Reuters) - As September's surge fades into a fond memory, the question for the U.S. stock market is: Now what?

The market shook off the summer doldrums last month, breaking out of a stubborn trading range and giving investors the second-best September on record with a gain of 8.8 percent on the S&P 500. It also racked up its best quarter in a year.

The strength of that momentum will be tested this week by a round of economic data, including the much-watched nonfarm payrolls report, as well as the start of third-quarter earnings season. The S&P has also been bumping up against a technical resistance level that could spark further gains if the index breaks through it.

Trading has been in a tight range the past week as the quarter wound down and the muted action could continue in the lead up to the employment report on Friday.

"People are still exhibiting a lot of fear in their investment decisions, with so much money flowing into bond funds and Treasuries, that any uptick in economic data could catch investors off guard," said Michael O'Rourke, chief market strategist at BTIG LLC in New York.

"That should help fuel a nice fourth-quarter rally in equities."

September nonfarm payrolls, due on Friday, are forecast to remain unchanged after a loss of 54,000 jobs in August, according to a Reuters poll of economists. However, the forecast range is wide, with a gain of 106,000 jobs on the upside and a loss of 75,000 jobs on the downside.

BREAKOUT COMING?

As the bulls and bears keep fighting over the stock market's direction, technical indicators have become more widely scrutinized. The S&P 500 has been bouncing between the 1,140 and 1,150 levels, but has fallen back from the top end of that range in the past six sessions.

While analysts have attributed some of September's move to "performance chasing," where gains beget more gains, O'Rourke thinks the real action might not happen until the fourth quarter.

"I view it more as a lot of people were sitting out the volatility, waiting for a trend to emerge," O'Rourke said. "If you get that breakout above 1,150 and it looks like it's a real breakout, that will give people confidence that a real trend has emerged to the upside."

History is on the market's side. A strong September usually portends a positive October and fourth quarter, according to Birinyi Associates Inc.

When September rises 5 percent or more, October is up, on average, 1 percent, according to data from Birinyi. Only in one occurrence following that type of September gain did the fourth quarter deliver a negative result, which happened in 1939 guaranteed unsecured personal loan.

KICKING OFF THE QUARTER

Analysts will be parsing comments from CEOs and other corporate talking heads as their companies release quarterly results to gauge how executives see the recovery unfolding. Investors have become more optimistic over the strength of recovery in the last month as worries of a return to recession have faded.

"I'm looking for companies to say things are not falling off a cliff. They're not rapidly improving, but we're starting to see this moderate, sustainable growth," said Kurt Brunner, a portfolio manager at Swarthmore Group in Philadelphia, Pennsylvania.

Alcoa Inc marks the unofficial start to earnings season when it reports quarterly results on Thursday. Other companies releasing results this week include Yum Brands Inc, Costco Wholesale Corp, Monsanto Co, Micron Technology and PepsiCo Inc.

Third-quarter earnings for the S&P 500 are forecast to grow 23.8 percent, though the estimate has shrunk slightly from the 25.6 percent that was predicted at the beginning of July, according to Thomson Reuters data.

On the economic front, pending home sales and factory orders for August kick off the week. Pending home sales are expected to rise 3 percent compared with a rise of 5.2 percent the month before, while factory orders are expected to dip 0.4 percent from a gain of 0.1 percent the previous month.

The Institute for Supply Management's September index for the non-manufacturing, or services, sector is expected to show a reading of 52, up from 51.5 the month before. The ISM services index will come out on Tuesday.

Wednesday will bring the ADP report for September, a precursor to the government's larger employment report for the month. The ADP data is forecast to show the private sector added 22,000 jobs last month.

In another glimpse of the labor front, initial jobless claims are expected to hold steady at 453,000 for the latest week, according to economists polled by Reuters.. That report is expected on Thursday.

And finally, wholesale inventories for August are expected to rise 0.5 percent, compared with 1.3 percent the month before. That data will come out at mid-morning on Friday.

(Reporting by Leah Schnurr; Editing by Jan Paschal)

Earnings, Jobs on Tap After September Rally

Filed at 5:36 p.m. ET

NEW YORK (Reuters) - Wall Street extended the rally on Friday, led by gains in resource stocks after data in China showed a pick-up in manufacturing activity.

Gains were tempered by data suggesting the rate of growth in U.S. factory activity slowed, but the upbeat trend in the market prevailed.

Friday's gains occurred on less-than-stellar volume, but two shares rose for every one that fell on the New York Stock Exchange. Energy and resource shares were helped by data out of China showing a pick-up in its manufacturing sector.

As copper hit a two-year high, gold jumped to another record at $1,322 an ounce and oil climbed above $80 a barrel to a seven-week high, shares of Freeport-McMoRan Copper & Gold Inc rose 4.4 percent to $89.13 and Occidental Petroleum Corp gained 3.2 percent to $80.77.

"The market is going to be very news dependent going in from now, especially after such a strong month. We have had some good news today, especially from China, that prompted a rally in Europe and was carried through the U.S.," said Stephen Massocca, managing director at Webush Morgan in San Francisco.

The Dow Jones industrial average rise 41.63 points, or 0.39 percent, to end at 10,829.68. The Standard & Poor's 500 Index advanced 5.04 points, or 0.44 percent, to 1,146.24. The Nasdaq Composite Index edged up 2.13 points, or 0.09 percent, to close at 2,370.75.

STOCKS DIP FOR THE WEEK

But for the week, the Dow fell 0.3 percent, the S&P 500 slipped 0.2 percent and the Nasdaq dropped 0.4 percent.

The S&P 500 also hit a key resistance level after it climbed as high as 1,150.30 before losing ground. That level is viewed as the top of a recent range after stocks surged during September.

The third quarter was the best in a year as investor concern about a double-dip recession faded on improved data and on expectations the Fed will inject more money into the economy. The S&P 500 gained 10.7 percent in the July-to-September period.

On a more cautious note, options traders also appeared to be pricing in higher volatility for the near-term free online credit report. The CBOE Volatility Index or VIX, Wall Street's so-called fear gauge, fell 5.1 percent to 22.50. But both the VIX and the CBOE Nasdaq Volatility Index had closed higher for four sessions out of five.

"Concerns about upcoming economic reports and the release of third-quarter earnings appear to have traders worried," said Scott Fullman, director of derivative investment strategy at WJB Capital Group.

"New healthcare regulations go into effect and the upcoming mid-term elections increase the probability for higher volatility."

TECH TAKES A BREAK

Technology shares ranked among the laggards as investors locked in some profits the day after indexes wrapped up the best quarter in a year. Amazon.com was among the biggest drags on the Nasdaq, down 2.1 percent at $153.71.

In corporate news, shares of Hewlett-Packard fell 3.1 percent to $40.77 after the company named former SAP Chief Executive Leo Apotheker as its new CEO and president.

Bank of America-Merrill Lynch on Friday downgraded Caterpillar Inc, a maker of heavy equipment, to "neutral" from "buy," saying that after a recent run-up in the shares, it saw limited upside. The Dow component was off 0.6 percent at $78.22.

Market regulators issued a report saying a massive sale of futures contracts by Waddell & Reed exacerbated the market's plunge on May 6, in what has become known as the "flash crash.

A total of 7.79 billion shares traded on the New York Stock Exchange, the Amex and the Nasdaq, compared with the previous year's daily average of 9.65 billion shares.

Advancing stocks outnumbered declining ones on the NYSE by about 2 to 1. On the Nasdaq, about 15 stocks rose for every 11 that fell.

(Reporting by Angela Moon; Additional reporting by Doris Frankel; Editing by Jan Paschal)

Wall Street Extends Rally as Resource Stocks Climb

Hot News: Wall St little changed as tech shares lag

Filed at 6:48 p.m. ET

WASHINGTON (Reuters) - The House of Representatives on Wednesday passed legislation to pressure China to let its currency rise faster, fanning the flames of a long-running dispute over trade and jobs.

The bill passed by a vote of 348-79. Both Democrats and Republicans, speaking just over a month ahead of mid-term elections in which the economy has taken center stage, said it was time to take action to support U.S. jobs.

The House vote, with about 100 Republicans joining Democrats to pass the bill, cleared the legislation for action in the Senate.

However, any vote in the Senate won't come until after congressional elections on November 2 when the U.S. political landscape could be greatly changed, and odds have appeared to be against passage in the Senate.

The bill treats China's exchange rate as a subsidy, opening the door to extra duties on Chinese goods entering the United States, some of which are already subject to special levies.

"China's persistent manipulation of its currency contributes to the outsourcing of American jobs and poses a very serious problem that requires real action," said House Ways and Means Committee Chairman Sander Levin.

House Speaker Nancy Pelosi said the bill would give President Barack Obama leverage in talks with China and "make it clear that if China wants a strong trading relationship with the United States, it must play by the rules."

The Obama administration has not taken a stance on the bill and may hope that just the threat spurs more movement from China.

Before the House vote, China's central bank reaffirmed its pledge to increase the flexibility of the yuan and improve the way it manages the exchange rate.

U.S. lawmakers have long brandished the sword of trade retaliation for what they see as China's policy of undervaluing the yuan to give its exports an unfair advantage. But they have never sent the president any legislation to sign into law.

Obama and Chinese Premier Wen Jiabao talked about China's currency and huge trade surplus with the United States on the sidelines of the U.N. General Assembly last week.

"The reason that I'm pushing China about their currency is because their currency is undervalued," Obama said on Wednesday. "That's not the main reason for our trade imbalance but it's a contributing factor."

Despite the yuan's modest gains against the dollar since Beijing allowed more movement in June, International Monetary Fund economists estimate the yuan is 5-27 percent undervalued.

Representative Dave Camp, the top Republican on the Ways and Means Committee, said he voted for the bill "because it sends a clear signal to China that Congress's patience is wearing out."

Representative Jeb Hensarling, a Texas Republican, said he feared China could retaliate against the bill by shutting its market to U.S. farm exports, offsetting any gains in U.S. manufacturing jobs.

Other lawmakers said the United States was already in a trade war with China and needed new tools to fight it.

And Senator Charles Schumer, a Democrat who has been one of the loudest critics in Congress of China's trade policy, said after the vote that he was ready to take up the cause in the Senate. "We plan to push our bill in the Senate when we return later this year," he said instant credit report.

GLOBAL CURRENCY WAR?

China's tight leash on the yuan is under intense scrutiny as countries around the world look to export their way back to economic health, raising concerns they will intentionally weaken their currencies to gain an edge.

Japan intervened this month to weaken the yen for the first time in six years.

The House move is certain to further roil relations with Beijing, which resents the criticism and says the decision about the speed of currency reforms is its alone.

China, the largest foreign buyer of U.S. government debt with holdings of nearly $847 billion as of July, also says its big trade surplus with the United States is due to Americans saving too little and no longer making the goods China sells.

While Obama has not taken a position on the legislation, House Majority Leader Steny Hoyer said lawmakers worked with the White House to ensure the bill did not violate WTO rules.

After holding the yuan steady against the dollar through the financial crisis, Beijing began to allow for an upward drift against the dollar on June 19.

Since then, the yuan has hit its highest level against the dollar in more than five years but, at just over 2 percent.

U.S. Treasury Secretary Timothy Geithner told Congress two weeks ago that Washington would work with Group of 20 nations to push China for faster appreciation but several allies expressed reluctance to join the effort.

G20 leaders are set to meet in Seoul on November 10-11. That would give U.S. senators time to gauge any further moves by China before deciding what to do, with supporters pushing for a vote on the bill after the November 2 election.

ECONOMISTS DOUBT BILL WILL WORK

The House bill allows the Commerce Department to treat "fundamentally undervalued currencies" as an illegal export subsidy so that U.S. companies can request a countervailing duty to offset China's price advantage.

That is expected to encourage steel, paper and other import-sensitive U.S. industries to file more cases. The United States now has countervailing duties on less than 3 percent of its imports from China, which totaled $296 billion in 2009.

Some economists said they understood the politics of the debate but questioned whether the bill would bring back American jobs or prod China to move faster on currency reform.

"We consume a lot. The Chinese save a lot. We're going to run a trade imbalance with them," said Derek Scissors of the Heritage Foundation.

China and the United States have a difficult but vital diplomatic relationship, not least in dealing with nuclear threats from Iran and North Korea.

In recent months, Washington and Beijing have also sparred over Chinese government procurement policies, Internet censorship, U.S. arms sales to Taiwan and U.S. sympathy for the Dalai Lama, the exiled Tibetan spiritual leader.

(Additional reporting by Matt Spetalnick in Des Moines, Susan Cornwell and Emily Kaiser in Washington; Editing by John O'Callaghan and Leslie Adler)

House Passes Bill to Get Tough on China's Yuan

Hot News: Wall St Ticks Up as Weak Data Points to Feds Move

Shares on Wall Street turned lower near the close on Monday amid a rush of corporate mergers but little in the way of fresh economic news.

Analysts said some traders were selling to lock in gains made over the last four weeks.

“We think there are a lot of people that are not fully engaged in the market right now, and with the quarter-end, or even year-end, looming it is quite possible we see more upside in the days and weeks ahead,” said Todd Salamone, Schaeffer’s Investment Research’s senior vice president for research.

“After a huge rally in the month of September, it would not be a major surprise for some type of consolidation, but we think there is a lot of short covering potential left,” Mr. Salamone said. “Whether it’s mergers and acquisitions, or buy-back activity taking some supply out of the market, or a continued low interest rate environment, one could argue they could impact the intermediate market.”

On Monday, Southwest Airlines, the nation’s largest low-fare carrier, said it had agreed to buy its smaller rival AirTran Airways in a transaction valued at $1.4 billion, expanding its foothold in New York and Boston and allowing it to move into Atlanta, the nation’s largest airport. Southwest said the purchase had been approved by the boards of both companies, although it still needs regulatory and shareholder approval.

In addition, Wal-mart said that it had made a proposal to acquire South Africa-based Massmart Holdings. And Unilever announced that it had entered into an agreement to acquire the Alberto Culver Company for $3.7 billion.

Shares of Southwest were 12.8 percent higher while AirTran rose 61.5 percent. Wal-Mart was down slightly, while Alberto Culver gained 20 percent.

Scott Wren, the senior equity strategist for Wells Fargo Advisors, said he expected more merger and acquisition activity, which typically provided a positive, yet temporary, lift for the markets quick payday loan.

“It is going to be about the economy,” Mr. Wren said.

That emphasis was evident last week, when the markets closed higher, after a report on manufactured goods orders that some investors saw as a sign that the economy was stabilizing. Reports this week on consumer confidence, housing and economic output will not likely have as much impact as expectations were already built in to the market.

“This is one of those weeks where you have a reasonable amount of data but you don’t really have a lot that I don’t think can really drive the market,” Mr. Wren said. “And in the final weeks prior to the election, other than employment surprise news, a lot of this stuff is just not going to move the market around.”

At the close, the Dow Jones industrial average was down 48.22 points, or 0.44 percent, to 10,812.04, and the Standard & Poor’s 500-stock index was down 6.51 points, or 0.57 percent, 1,142.16. The Nasdaq composite index was 11.45 points, or 0.48 percent, lower, to 2,369.77.

The yield on the 10-year Treasury note fell to 2.51 percent from 2.60 percent late Friday.

The S.& P. has risen 9.47 percent in the month to last Friday. Some analysts suggested that the broader market was approaching a technical level as it nears 1,150, where it was likely to register some volatility over the next weeks even though it would not likely experience much net change by the end of the year.

Stocks in Europe were also lower. In London, the FTSE 100 index was down 25.06 points, or 0.45 percent, while the DAX in Frankfurt fell 19.41 points, or 0.31 percent. The CAC 40 in Paris was 16.42 points, or 0.43 percent, lower.

///

Jad Mouawad contributed reporting.

Wall Street Ends Lower Amid a Rush of Deals

WASHINGTON (Reuters) – Google, Apple, Adobe Systems, Intel, Intuit and Disney&&9;s Pixar reached a settlement with the Justice Department that bars the companies from agreeing to not poach each other&&9;s top employees, the department said on Friday.

The firms had reached a series of agreements with each other -- Apple had deals with Google, Adobe and Pixar while Google had separate deals with Intel and Intuit -- agreeing not to cold call each others&&9; workers, the department said.

Such agreements are a violation of antitrust laws since agreeing not to hire away top talent could stifle competition for highly skilled workers and hold down wages cash advance america.

"The companies engaged in a practice of agreeing not to cold call any employee at the other company," the department said. "The complaint indicates that the agreements were formed and actively managed by senior executives of these companies."

(Reporting by Diane Bartz; Editing by Leslie Gevirtz)

Top tech firms settle employment probe

Filed at 6:10 p.m. ET

TORONTO (Reuters) - BHP Billiton said on Thursday it has received antitrust clearance from U.S. regulators to proceed with its $39 billion (25 billion pound) bid for Canada's Potash Corp, clearing its first regulatory hurdle in the process.

Last month, the Anglo-Australian miner launched its hostile offer to take over the world's largest fertilizer company. Potash Corp has flatly rejected the bid as "grossly inadequate" and filed a lawsuit against BHP in an attempt to stymie it.

BHP's bid is still contingent on other regulatory approvals business cards. It is likely to face much tougher scrutiny in Canada, where Canada's competition watchdog has already requested for additional information.

The request prompted BHP to extend the deadline on the tender offer by a month to November 18.

(Reporting by Euan Rocha; Editing by Frank McGurty)

BHP Bid For Potash Corp Clears U.S. Antitrust Hurdle

Filed at 7:57 p.m. ET

SANTA FE, N.M. (AP) -- The chairwoman of the state's Environmental Improvement Board took issue Tuesday with allegations that some members of the panel have a conflict of interest in considering a state proposal for the regulations of greenhouse gas emissions.

Gay Dillingham addressed the allegations after a break in a hearing on the state's cap-and-trade proposal, which would give companies economic incentives to reduce carbon emissions. She told the crowd -- mostly experts and lawyers for the state Environment Department, electric utilities and industry groups -- that the seven-member board is made up of people with diverse experience and integrity and that none stands to gain financially from the outcome of the case.

''I see these proceedings as very educational. It's a difficult matter and I think all of us are listening very intently, and to say that any of our votes are predetermined, I take offense to that,'' Dillingham said.

Her comments came during the second day of a two-week hearing on the state Environment Department's petition for new regulations, which would impact polluters such as electric generating stations, refineries and natural gas processing plants.

There have been rumblings for months about the connections some board members have to environmental interests. The board sought to put an end to the claims Tuesday when it asked the audience whether anyone thought there was a conflict. There was no response and the hearing resumed.

Under the state's proposal, New Mexico would be able to participate in a regional cap-and-trade program with other states and Canadian provinces. The state would not implement the program unless there were sufficient greenhouse gas allowances to make trading efficient and cost-effective.

The proposal also includes a sunset provision if the federal government were to implement its own program.

Critics contend the proposal would devastate New Mexico's economy, but state officials argued it's imperative to control emissions to limit the potential impacts of climate change on New Mexico.

''This is another example, I think, of industry overreacting to commonsense regulation. We've really thought this through and put a lot of cost-control measures into it,'' said Jim Norton, director of the Environment Department's Environmental Protection Division.

Economists testifying for the state predicted through modeling that the proposed cap-and-trade plan would have a small economic impact on New Mexico. Depending on the different variables used for each scenario tested, they said the state could see an increase of about 2,500 jobs or a loss of up to 3,100 jobs by 2020 payday loans.

''This is not going to turn the way of life upside down,'' economist Adam Rose testified, saying the numbers were statistically minute when considering overall job and population growth.

On cross-examination, the economists acknowledged their models included assumptions that complimentary polices such as clean car regulations, and energy efficiency and renewable energy standards, would be implemented along with the cap-and-trade program.

They theorized that electric prices wouldn't rise if emissions were capped because demand would be reduced due to higher efficiency. They also pointed out that under the plan, polluters wouldn't have to pay for the initial emissions allowances they receive, meaning any competitive disadvantage versus other states would be reduced.

Under most of the scenarios, the economists said utility customers would actually see decreases in their electric rates.

They also noted that their models did not account for any impacts the plan would have on public health.

Attorneys for Public Service Company of New Mexico and Tri-State Generation and Transmission Association questioned the accuracy of the economists' models, prompting a motion to limit questioning to keep the hearing moving ahead.

Tauna Szymanski, an attorney for Tri-State, defended her questions.

''The economics is perhaps the most essential point of this rule-making. It's a really critical factor for the board to consider,'' she said.

Board member Frank Simms agreed, saying economics is at ''the heart of what we're being asked to decide.''

The board did side with the department by granting a motion to strike testimony from one expert who was scheduled to speak on behalf of the Coalition of Arizona/New Mexico Counties for Stable Economic Growth, which opposes the state's plan. The department argued the witness misrepresented himself and lacked credentials to testify.

Board members have more than 6,000 pages of documents to review. A decision could be reached in late October or early November.

Aside from the state proposal, the board is also considering a petition from the environmental group New Energy Economy that aims to curb greenhouse gas emissions from the state's largest polluters, including coal-fired power plants and the oil and gas industry.

NM Enviro Panel Rebuts Conflict-Of-Interest Claims

Filed at 7:12 p.m. ET

LONDON (Reuters) - Children's weekly pocket money has fallen to a seven-year low, in a sign parents are still cutting back on non-essential spending even as the country emerges from recession, a survey showed on Monday.

Halifax, part of Lloyds Banking Group, said average pocket money fell to 5.89 pounds a week in 2010 from 6.24 pounds in 2009. The new figure is the lowest weekly sum since 2003 when parents paid an average of 5.79 pounds.

Children's pocket money has fallen despite a small rise in their parents' wages over the past year. Average weekly pay in Britain in the three months to July was 431 pounds excluding bonuses, 1.8 percent more than a year earlier personal humidifier.

Parents paid daughters less pocket money than sons, in a parallel to the gender gap in the earnings of grownups.

Girls received an average 5.70 pounds a month, compared to 6.08 pounds a month for boys, a difference of around 6 percent compared to 12 percent between men and women in full-time work.

Halifax based its data on a survey of 1,204 children aged between 8 and 15 conducted from August 26 to September 2.

(Reporting by David Milliken)

Children's Pocket Money Falls to 7 - Year Low