Treasury Secretary Timothy Geithner said the Obama administration is committed to reducing the federal budget deficit after concerns rose that the U. S. debt rating may eventually be threatened with a downgrade. He added that the target is reducing the gap to 3 percent of gross domestic product or smaller, from a projected 12.9 percent this year. Britain saw its own AAA rating endangered earlier yesterday when Standard & Poor's lowered its outlook on the nation's grade to "negative" from "stable," citing a debt level approaching 100 percent of U. K. GDP.

The dollar, Treasuries and American stocks slumped yesterday on concern about the U. S. government's debt rating.

The Treasury chief said it's still "possible" that the unemployment rate may reach 10 percent or higher, cautioning that the economic recovery is still in the "early stages."

Initial claims for unemployment insurance fell by 12,000 in the week ended May 16 to 631,000, according to Labor Department statistics released today. Still, the number of workers collecting unemployment checks rose to a record of more than
6.6 million in the week ended May 9.

The U. S. government will send General Motors Corp. into bankruptcy next week, the Washington Post reported, citing unidentified sources familiar with the talks.

The car company would get $30 billion in additional federal loans as part of the bankruptcy plan, the newspaper said, citing a source it didn't identify.

Bank United Financial Corp., the ailing Florida lender, was shut by federal regulators and its assets were sold to private-equity firms including WL Ross & Co. and Carlyle Group in the largest U. S. bank failure this year.

Morgan Stanley raised its year-end forecast for India's rupee to 46 per dollar from 52, citing the nation's improved economic outlook following the ruling Congress Party's election victory. Morgan Stanley this week raised its 2009 economic growth forecast for India to 5.6 percent from 4.3 percent, and its 2010 projection to 6.6 percent from 6.1 percent, the report said.

We expect Indian market to open lower but bounce back during the day. Mid cap and small cap stocks are likely to see profit booking today.