STOCKS NEWS US-U.S. service sector shrank in May: ISM

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For U.S. stock market report double-click [.N] 1014 ET 03June2009-U.S. service sector shrank in May: ISM ------------------------------------------------------------------------------

The U.S. services sector shrank again in May, according to the Institute for Supply Management's nonmanufacturing index.

The index edged up to 44.0 in May from 43.7 in April. The analyst consensus estimate was for a reading of 45.

Any reading below 50 represents contraction in the sector.

For details, see [ID:nWEN9983]

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net 1009 ET 103June2009-Factory orders up 0.7 percent in April ------------------------------------------------------------------------------

New orders received by U.S. factories rebounded in April, data from the Commerce Department showed on Wednesday, rising 0.7 percent in the month. Analysts were expecting a rise of 0.9 percent.

"Factory orders have been incredibly weak since August of last year. They've only only recently shown signs of stabilization, so in that respect, despite being weaker than expected, any positive reading is a desired outcome at this point," said Dan Greenhaus, an analyst at Miller Tabak & Co in New York.

For details, see [ID:nN02175619]

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net 0955 ET 03June2009-Steel sector falls after Steel Dynamics measures ------------------------------------------------------------------------------

Shares of steel companies fell on Wednesday, a day after Steel Dynamics (STLD.O) cut its quarterly dividend by 25 percent and said it plans to offer 27 million of its common shares and $150 million of convertible senior notes due 2014 to repay debt.

For details, see [ID:nBNG498001]

The Dow Jones U.S. Steel index .DJUSST slid 5.3 percent to $210.59 while Steel Dynamics was off 8.2 percent to $14.32. Among other companies in the group, AK Steel (AKS.N) dropped 6 percent to $15.16, U.S. Steel (X.N) dropped 4.7 percent to $34.72 and Nucor (NUE.N) dropped 4.6 percent to $45.22.

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net 0950 ET 03June2009-Mortgage applications fall as rate advance ------------------------------------------------------------------------------

U.S. mortgage applications fell last week, reflecting a plunge in demand for home refinancing loans as interest rates surged to their highest levels since late January, according to data from the Mortgage Bankers Association.

The MBA said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended May 29 decreased 16.2 percent to 658.7.

For details, see [ID:nN02520526]

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net 0942 ET 03June2009-Tessera shares gain after outlook, Motorola deal ------------------------------------------------------------------------------

Shares of Tessera Technologies Inc (TSRA.O) rallied on Wednesday, a day after the company said Motorola Inc (MOT.N) signed an agreement to license its technology and settle all outstanding litigation between the companies.

Tessera also lifted its second-quarter revenue outlook, expecting the deal to add to its royalty and license-related revenue.

For details, see [ID:nBNG466224]

The stock gained 5.3 percent to $25.75 on Wednesday while Motorola was down 1.7 percent to $6.30.

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net 0935 ET 03June2009-Capital raises suggest thaw in credit: firm ------------------------------------------------------------------------------

DA Davidson on Wednesday wrote that the ability of large banks to successfully raise capital by selling stock "is another indication that pressure in the credit markets is easing."

"The credit markets appear headed back to a level of risk appetite seen early last fall, but not back to the point seen at the height of the credit boom in 2006 and 2007," it added.

The firm also wrote that while banks and credit lenders continued to look for creditworthy borrowers for home and car loans, they were also continuing to restrict credit to home builders and land developers "as they struggle under the growing weight of loan write-offs and add foreclosure properties to their balance sheets."

Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net