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The Dow closed higher after spending the majority of the day below the line. Tech stocks made the largest gains, while commodity prices continued to fall despite a weakening greenback.

Treasury Secretary Timothy Geithner said the Federal bailout plan would be extended until 3 October 2010. Meanwhile, he said the TARP would be scaled back and refocused with an aim of preventing foreclosures and making loans to small businesses.

In economic news, wholesale inventories increased 0.3% in October, well ahead of the forecast decline of 0.5%. Wholesale inventories dropped 0.8% in September.

The Dow Jones added 51.08 points, or 0.50%, to 10,337.05, the S&P 500 edged 4.01 points higher, or 0.37%, to 1,095.95 and the NASDAQ put on 10.74 points, or 0.49%, to 2,183.73. 

In active talks Citigroup fell 1.3% as it plans to raise equity to pay back TARP funds.

Bank of America edged 0.1% lower a day after announcing it had paid back the US$45 billion in government bail out money in full.

Goldman Sachs gained 2.8%.

3M and Sprint Nextel rallied 3.3% and 5.6% after Citigroup analysts advised buying the stocks.

Pfizer gained 2.7% after a positive note by Credit Suisse boosted the stock. 

Tech heavyweights Apple and IBM put on 4% and 1.3% as larger rival Microsoft added 0.5%.

Hewlett-Packard added 2.1%.

Research in Motion shares jumped 4.9% as investors bet the wireless company’s shares will surge over 30% in the next five weeks due to improving sales, particularly in China.

Energy stocks were mixed after crude futures were impacted by willingness to exit the market ahead of the release of weekly US oil and fuel inventory data. Forecasts are for a 600,000-barrel increase in oil inventories.

Exxon Mobil slid 0.2%, while Chevron and ConocoPhillips gained 0.4% and 0.6%.

NYMEX light crude oil for January delivery fell US$1.95 to settle at US$70.67 a barrel.

COMEX gold for February delivery fell US$22.50 to settle at US$1,120.90 an ounce.

Newmont Mining and Barrick Gold recovered some of their recent losses, closing 2.8% and 1.9% in the black.

European Markets

Financials dragged European markets lower after Standard and Poor’s downgraded its outlook on Spain. Resource stocks were mainly lower as commodity prices weakened.

The UK benchmark FTSE 100 lost 19.24 points, or 0.37% to 5,203.89. The French CAC40 shed 27.91 points, or 0.74% to 3,757.39, while the German DAX fell 40.74 points, or 0.72% to 5,647.84.

Yesterday, Fitch Ratings cut Greek debt on concerns over its public finances. The Greek banking index has fallen 5.8% so far this week and about 38% since mid-October.

Barclays, Commerzbank and Deutsche Bank dropped 3.3%, 2.3% and 1.7% respectively.

On the other side of the line Lloyds and Standard Chartered put on 1.7% each.

Insurers AXA and Prudential weakened 4% and 2%.

The major miners were mixed. Anglo American, Antofagasta and BHP Billiton lost between 0.2% and 0.4%.

Rio Tinto and Xstrata added 1.7% and 1.9%.

In the energy sector, BG Group and BP slid 1% and 0.8%, while Royal Dutch Shell rose 0.3%.

Volkswagen advanced 0.7% on reports it will purchase a 19.9% stake in Suzuki Motor. Peugeot, Renault and Daimler fell 2.4%, 1.9% and 1.4% respectively.

Pharmaceuticals lost ground. Merck and GlaxoSmithKline shed 2% and 1%.

Stada Arzneimittel rallied 5.2% on the belief the German drug maker could be worth more and that it could be the target of a takeover soon.

Japanese Markets

Global credit concerns, softening US economic data and a slowing recovery in Japan itself all contributed to a day of heavy selling on the Nikkei. Banks were the major losers, while a stronger yen hurt exporters.

The market shrugged off government efforts to revive the economic recovery. The Japanese government rolled out another stimulus package yesterday, this one valued at US$81 billion to prop up the fragile economic gains made in recent months.

The Nikkei 225 shed 135.75, or 1.34% to 10,004.72. 

The most heavily traded stock for the day was Japan’s number one bank, Mitsubishi UFJ Financial Group, which tumbled 5.2%.  

Mizuho Financial Group gave up 3%. 

Among the autos, Honda and Mitsubishi shed 2.1% and 1.6% respectively. Toyota retreated 1.1%. 

Suzuki Motor Corp bucked the trend, climbing 3.5% after reports Volkswagen would take a 20% stake in the company. 

Consumer electronic giants Sony and Panasonic gave up 2.9% and 1.5% respectively. 

Nippon Oil retreated 2.6% on weakening global oil prices.

Hong Kong Markets

Hong Kong shares lost ground for the fourth consecutive session. Falls within the financial sector led the decline.

The Hang Seng dropped 318.76, or 1.44% to 21,741.76.

HSBC lost 2.6% on renewed concerns regarding its exposure to Dubai World. Standard Chartered shed 4.2% after CLSA Asia-Pacific Markets downgraded its rating on the stock for the second time in two weeks.

ICBC and China Construction Bank slid 1.5% and 1.9%.

Chinese Overseas Land & Investment fell 3.1% following reports that the nation would curb “speculative” home purchases.

Country Garden Holdings sank 4.5%.

Jiangxi Copper dropped 3.8% on falling metals prices.

Texwinca Holdings surged 13% after Deutsche Bank increased its target price on the knitted fabric producer by 29%. Morgan Stanley and JPMorgan also lifted their target prices on the stock.