Wall Street edged higher as investors remained cautious heading into the reporting season. Financials strengthened, while energy stocks tracked the price of crude higher.

In economic news, the number of people filing new unemployment claims fell from 617,000 the previous week to 565,000 last week, beating expectations. However, continuing claims climbed to a record 6,883,000.

Meanwhile, wholesale inventories dropped 0.8% in May following a 1.3% fall the previous month.

The Dow Jones gained 4.76 points, or 0.06%, to 8,183.17, the S&P's 500 added 3.12 points, or 0.35%, to 882.68 and the NASDAQ picked up 5.38 point, or 0.31%, to 1,752.55.

Financials bounced with Goldman Sachs gaining 3.4% following a broker upgrade. JPMorgan, Wells Fargo and Bank of America put on 2.8%, 1.6% and 1.1% respectively.

Citigroup and Morgan Stanley advanced 2.7% and 1.5%.

Berkshire Hathaway slid 1.6%, while American International Group slumped 27.6% after an analyst slashed its rating due to reports the insurer had no equity value. A separate report suggested AIG has revived talks with MetLife over unloading all or part of American Life Insurance Co.

Retailers continued to feel the pinch due to the recession. Abercrombie & Fitch and Limited Brands dropped 4.2% and 4% after they both reported sales figures below expectations.

Wal-Mart and Costco shed 0.6% and 1.1%, while Target bucked the trend adding 3%.

Energy stocks advanced as the price of crude rose following seven sessions of declines. NYMEX light crude oil for August delivery rose US27 cents to settle at US$60.41.

ConocoPhillips added 2.2%, while Chevron was 0.5% dearer. Exxon Mobil shed 0.4%.

Alcoa slid 2.4% despite reporting losses that were better than expected. AK Steel and United States Steel rallied 5.5% and 2.9%.

COMEX gold for August delivery rose US$6.90 to settle at US$916.20 an ounce.

European Markets

European stocks regained some of the losses witnessed over the past week as positive jobs data out of the US buoyed investors. Stronger metal prices and Alcoa’s better than anticipated result helped miners.

The UK benchmark FTSE 100 added 18.43, or 0.45% at 4,158.66. France’s CAC40 gained 16.23, or 0.54% to 3,025.94, while the German DAX put on 57.42, or 1.26%, to 4,630.07.

Of the major miners Anglo American, Xstrata and Antofagasta jumped 5.6%, 3.9% and 2.6% respectively. Aussie miner Rio Tinto gained 3.8%, while peer BHP Billiton edged 0.2% higher.

Energy stocks were realtively flat although Total managed to close 1.1% above the line.

Germany’s banks were the standouts among the financials. Deutsche Bank and Commerzbank rose 4.6% and 1.5%.

France’s BNP Paribas and Societe Generale gained 1% and 0.4%.

The UK banks were mixed with HSBC and Barclays adding 1.4% and 0.4%, while Lloyds and Royal Bank of Scotland were 0.6% and 0.5% in the red.

Of the insurers Aviva and Prudential fell 4% and 1.9%. Allianz and AXA put on 1.3% and 0.6%.

An analyst upgrade to the European automaker sector sent Daimler 2.7% above the line.

Japanese markets

Japanese stocks fell for the seventh consecutive day. A stronger yen dragged exporters, while financials lost ground.

The Nikkei 225 dropped 129.69, or 1.38% to 9,291.06.

Honda and Yamaha shed 2.7% and 1.3%, with the latter being affected by a broker downgrade due to lower sales.

Bic Camera sank 5.1% after posting a significant fall in profit for the first nine months. Canon dropped 1.5%.

Office equipment maker Ricoh weakened 3.6%.

Banks Chuo Mitsui, Aozora Bank and Shinsei Bank lost 5.1%, 4.6% and 3.6% respectively after it was revealed they will all be required to submit business improvement plans after failing to reach profit targets set for companies receiving public funds.

Brokerage Daiwa Securities drifted 2.4% lower.

Japan’s largest maker of cosmetics and toiletries Shiseido slid 2.7% on the expectations domestic sales will remain disappointing.

Hong Kong Markets

Hong Kong and Chinese markets both gained Thursday. The markets were buoyed by an uptick in consumer sentiment, reflected in strong June car sales in China.

The Hang Seng added 69.52, or 0.39% to 17,790.59.

China’s number three car-maker, Dongfeng Group spiked 9% after June car sales eclipsed May car sales.

Geely Automobile Holdings soared 11%. Several other car companies rose around 10%.

Beer maker and retailer, China Resources Enterprise soared 6.8%.

Hong Kong markets, trading on a lower crude price in the US, saw refiners and the airlines advance. Refiner Sinopec climbed 3.9%, while China Air rose 2.1%.

Cathay Pacific climbed 3.1%.

Property developers weighed on the market, with state-owned China Overseas Land & Investment down 4.1%, while Hang Lung Properties slumped 3%.

The Overnight MarketWatch report is provided by SHAW Stockbroking's egoli - simple but informative market news for the everyday investor.

egoli news: A view of the Australian market, from your perspective, as it happens. For more information go to www.egoli.com.au/news/