Wed Aug 25, 2004
By Anshuman Daga

LONDON (Reuters) - Wall Street is expected to open flat on Wednesday, with investors focusing on crude oil prices which inched up after a three-day losing streak, while U.S. durable goods data will also be closely watched.

Traders said the market will be cautious as security officials in Russia investigate a possible terrorist attack after two Russian passenger planes crashed almost simultaneously late on Tuesday killing all 90 on board. "It creates an overall sense of anxiety again and this is not what the markets needs," said Steve Previs, a trader at Jefferies International in London.

In corporate news, Motorola will be eyed after the world's second-largest mobile phone maker and NTT DoCoMo Inc., Japan's top mobile phone operator, said they would jointly develop third-generation handsets.

The deal gives Motorola a way into a market largely out of reach for foreign manufacturers.

Toronto-Dominion Bank is in advanced talks to acquire control of Banknorth Group Inc. in a deal worth more than $2.2 billion, the Financial Times reported.

Elswhere, U.S. light crude gained 14 cents to $45.35 a barrel on concerns about attacks on Iraq's pipelines, breaking a three-day fall in prices. Investors are concerned that a runaway rise in oil prices would crimp corporate profits and hit economic growth.

Overall, stock market activity remains lackluster with trading volumes hit by the summer holiday season.

"It's a very sloppy market and we have been seeing a poor quality and low volume-led rise," said Previs.

On Tuesday, the Dow Jones industrial average closed up 0.25 percent at 10,098.63 points, while the Nasdaq Composite Index was off 0.10 percent at 1,836.89 points.

DATA EYED

U.S. orders for durable goods, which are big-ticket items meant to last three years or more, are likely to have continued to rise in July, thanks largely to demand for transportation and defense-related goods, a Reuters poll showed.

The July durable goods report is due at 0830 EDT and the Reuters poll showed orders are forecast to rise 1.0 percent, versus a versus a rise of 0.9 percent in June.
Elsewhere, Standard & Poor's said capital expenditures for S&P 500 companies are expected to turn positive in 2004 after two consecutive years of declines.

Among stock movers, shares of H&R Block, the largest U.S. tax preparation firm, tumbled in after-hours trading on Tuesday.

The company posted a first-quarter loss, compared with a year-ago profit, as higher interest rates shrank margins in its mortgage lending unit.

Shares fell to $47.60 on the INET electronic brokerage system, from their close of $51.23 on the New York Stock Exchange.

OmniVision Technologies Inc., which designs image sensors used in digital cameras, fell nearly 8 percent after its outlook for the current quarter came well below Wall Street estimates.

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