ECONOMY & MARKETS

Wall Street expects Federal Reserve policy-makers to cut interest rates next Tuesday to help ease a global credit squeeze, a much anticipated event that spurred stock prices higher this week and could boost them next week.

Stocks edged up slightly on Friday as expectations of an interest rate cut off-set concerns of a weakening U.S. housing market.

The dollar edged up against the yen on Friday but remained near a record low against the euro as consumers braced for what is expected to be the first reduction in U.S. interest rates in four years next week.

Stocks were little changed on Friday as weakness in semiconductor makers after a broker downgrade of Intel Corp was offset by strength in energy producers.

Shares in British housebuilders fell sharply on Friday, with sector leaders skidding over 8 percent, as reports of falling house prices and liquidity problems at mortgage lender Northern Rock raised concerns over reduced home demand.

Wall Street grew anxious on Friday after news that Britain's central bank was forced to rescue mortgage lender Northern Rock, suggesting a global credit crisis was spreading.

Major U.S. indexes started off the day slightly lower on Friday as August retail sales disappointed while the subprime crisis extended overseas as the Bank of England rescued mortgage lender Northern Rock.

Stock futures fell on Friday, suggesting Wall Street shares could open under pressure after British mortgage lender Northern Rock became the biggest UK casualty of the current liquidity squeeze.

U.S. stocks rose on Thursday after a Wall Street analyst said brokerage shares were undervalued and McDonald's Corp raised its annual dividend by 50 percent.

Chinese shares have reached a dangerously high level because the market is failing to price risks properly, just as investors misjudged the value of U.S. subprime mortgages, an academic economist said on Thursday.

The dollar rebounded against the yen and euro on Thursday as investors resumed buying the U.S. currency after nearly a week of declines, although expectations of a cut in U.S. interest rates capped gains.

Goldman Sachs and UBS cut their earnings forecasts and share target prices on Samsung Electronics Co Ltd and Hynix Semiconductor Inc, underscoring a weakening outlook for the chip maker sector.

Stock index futures rose on Thursday after an upgrade of General Motors Corp. sent shares of the auto maker higher. Trading was likely to be choppy before the Federal Reserve's interest-rate decision next week and volume lower due to the Jewish New Year.

Most Asian stocks rose on Thursday with energy stocks higher as oil held near a record peak above $80, while expectations of an U.S. rate cut next week pinned the dollar near an all-time low versus the euro.

European shares fell on Thursday, led by France's Alcatel-Lucent, which cut its full-year revenue forecasts, while record-high oil prices made oil and gas producers the top gainers in early trade.

The euro surged to a lifetime high against the dollar on Wednesday, weighing on European shares as investors remained nervous over the health of the U.S. economy even with an expected interest rate cut there next week.

Stocks were little changed on Wednesday as investors awaited U.S. data on oil inventories, while oil prices extended a rise to record highs, potentially straining consumer spending and corporate profits.

Corporate default rates could accelerate from next year as the recent turmoil in credit markets has erased the appetite for risky investments, ratings agency Standard & Poor's said in a report.

Stock index futures pointed to a weaker market open on Wednesday, with Texas Instruments in focus after the chipmaker left its outlook steady.

The dollar fell to a record low against the euro on Wednesday as an expected interest rate cut next week from the Federal Reserve continued to erode the U.S. currency's appeal.

Japanese stocks ended in negative territory on Wednesday after the shock resignation of Prime Minister Shinzo Abe, with the Nikkei average down 0.5 percent as thin trade and political uncertainty took their toll.

The dollar neared a record low against the euro on Tuesday as expectations of a Federal Reserve interest rate cut continued to erode the greenback's appeal to global investors.

The slump in U.S. housing stocks to new four-year lows is hurting some well-known investors who recently added home builders and housing-related stocks such as KB Home and Pulte Homes Inc to their positions.

Stocks rallied on Tuesday, bolstered by confidence the Federal Reserve will cut interest rates next week, another round of upbeat outlooks from technology companies, and solid sales from McDonald's Corp.

ImClone Systems inc. announced Tuesday that the cancer drug Erbitux showed positive results, meeting its goal of increased survival rates of patients with advanced lung cancer.

Stocks closed little changed on Monday as strength in semiconductor stocks tied to Intel Corp.'s higher sales outlook offset lingering concerns about the mortgage market. An afternoon rally fizzled when oil shot to within a whisker of a record, sparking fresh worries that high gasoline costs will squeeze consumer spending.

The chances of an economic recession are increasing as troubles in the housing sector and credit markets take their toll, according to a survey of economists released on Monday.

Stocks fell on Monday as bank shares declined on fears of bigger-than-expected loan losses related to housing, while a drop in crude oil prices hurt energy shares.

Bank Citigroup will list its shares in Tokyo as early as November as part of the financial giant's push into the world's second-largest economy, sources familiar with said.