(By Salman - iStockAnalyst Writer)Wall Street extended its rally and was trading flat in green in early hours of the trading. At 9:36 New York time, Dow Jones Industrial Average (.DJI) added 0.24 points to 11510.98. Nasdaq too was trading in green (+0.47%) while S&P was trading in negative territory (-0.20%).

Crude oil declined as much as 2% at NYMEX as Saudi Arabia's oil minister said supplies are sufficient to meet demand, signaling that OPEC may maintain production levels when it meets today. Dollar continued its rally against the basket of worlds’ major currencies and even hit the year high against Euro. The dollar touched $1.4047, the strongest level since Oct. 9, 2007.

Credit Suisse said the GSE conservatorship will lower mortgage rates between 0.3 and 0.4 percentage points, which aids affordability by the same as 3% to 4% fall in home prices.

Data is due for release on pending home sales and wholesale inventories for July. Federal Reserve Chairman Ben Bernanke is due to deliver a speech, but education is the subject and no question-and-answer session is scheduled, leading many analysts to conclude the speech won't be market moving.

HP (HPQ) was raised to "outperform" from "market perform" at Sanford C. Bernstein & Co, which also raised its price target on the stock to $55 from $51. HP shares rose to $46.40 before the bell.
McDonald's (MCD) reported a 4.5% rise in comparable sales during August. McDonald's, the world's largest restaurant chain, rose to $63.39.

Avery Dennison Corp., (AVY) the Pasadena, Calif., provider of label, retail tags, branding systems, and office supplies, said that net income for July and August 2008 came up 15 cents to 20 cents a share short of its internal forecasts.

Cigna Corp. (CI) expects to affirm its earnings outlook for 2008 in calls and meetings with investors and analysts, according to a Securities and Exchange Commission filing. In August, the company said it expects 2008 earnings of $4.05 to $4.25 a share. Analysts estimate earnings of $4.21 a share.

Coca-Cola: (KO) Chinese juice makers may challenge the Atlanta soft-drink giant's proposal to buy Huiyuan Juice (HK:1886: news, chart, profile) for $2.4 billion.

Kimberly-Clark (KMB) was upgraded to buy from hold at Citigroup, with the broker saying its fortunes have turned up. Since a warning on July 14, oil prices are down 30%, natural gas is down more than 40%, pulp prices are down 3% to 5%, and most of its product prices are rising.

Lehman Brothers: (LEH) U.S. comparable sales rose 4.5% in August. Global comparable sales at the Oak Brook, Ill., fast-food giant increased 8.5% in August, while systemwide sales for McDonald's worldwide restaurants rose 14.1%. Lehman shares were down 4.2 percent at $13.55 before the bell.

Novartis (NVS) was downgraded to hold from buy at Deutsche Bank, with the broker citing lack of potential for earnings surprises. "Following continuous upgrades to the consensus pharma margin estimates, consensus estimates are now at what we believe to be reasonable levels.

Pfizer Inc.: (PFE) A panel of medical experts gave a limited endorsement to Pfizer's proposed osteoporosis drug, Fablyn, The Wall Street Journal reported on Tuesday.

Reynolds American Inc. (RAI) will take a third-quarter pretax restructuring charge of about $90 million, related to severance, benefits and related costs.

European stocks rose, extending yesterday’s rally. At 14:44 PM London time, FTSE was up 0.45% at 24, while DAX and CAC were up 0.24% and 0.17% at 6278.24 and 4347.58 respectively.

On the other hand, Asian Stocks declined on Tuesday. The Nikkei average fell 1.8 percent on Tuesday. Hang Seng Index too tumbled and finished 1.5% down.

DISCLOSURE: The Author does not own any stocks mentioned here.