U.S. markets are likely to decline Friday morning after oil touched US$66 a barrel and the June trade deficit ballooned to US$58.82 billion.

Crude-oil prices Friday rose to new highs, as reports of new U.S. refinery outages rekindled fears that gasoline supplies would struggle to meet rising demand. In early New York trading, oil prices climbed 21¢ to US$66.01 a barrel.

After the bell Thursday, Dell reported its fiscal second-quarter profit rose 28% on a tax adjustment and strong sales in Europe and Asia, but deep discounting in personal-computer prices failed to ignite U.S. sales. The world’s largest PC maker offered a lukewarm outlook for the current quarter’s sales and earnings. Dell shares fell $3.03, or 7.7%, to $36.55 in after-hours trading following the report.

In today’s economic news, the U.S. Commerce Department said the June deficit widened 6.1% to US$58.82 billion amid rising oil prices and record demand for foreign crude. Economists called for a June deficit of US$57.5 billion.

Separately, the U.S. Labor Department said July import prices rose 1.1%, the fastest pace in four months. Economists expected import prices to rise by a moderate 0.6% last month after a 1.0% gain in June.

In other economic news, the University of Michigan is slated to release its preliminary reading of consumer sentiment for August around 9:45 a.m. Economists look for an unchanged reading of 96.5 in the preliminary August reading of consumer sentiment from the final July reading.

Here at home, Statistics Canada reported that Canada’s trade balance with the world increased to just short of $5.0 billion in June as exports to countries other than the United States hit an all-time high, Companies exported $37.2 billion worth of merchandise, up 1.8% from May, with most of the gain going to the European Union and other Organisation for Economic Co-operation and Development nations.

The Canadian dollar opened at US83.39, up 0.11 of a cent. On Thursday, the loonie rose 0.66 of a cent as the greenback weakened.

In today’s earnings news, O&Y Properties Corp. reported a a second-quarter loss of $3.2 million, compared with a year-ago profit of $17 million. A Brookfield Properties-led group (TSX:BPO) has until Aug. 29 to go ahead with its $13-a-share bid for O&Y Properties after unitholders of the O&Y REIT rejected a corresponding offer from the group.

After the bell Thursday, computer maker Dell Dell reported its fiscal second-quarter profit rose 28% on a tax adjustment and strong sales in Europe and Asia, but deep discounting in personal-computer prices failed to ignite U.S. sales. The world’s largest PC maker offered a lukewarm outlook for the current quarter’s sales and earnings. Dell shares fell $3.03, or 7.7%, to US$36.55 in after-hours trading following the report.

In overseas trading, Japan’s four-day stock rally ended as investors locked in profits.

The benchmark Nikkei 225 index fell 1.64 points, or 0.01%, to 12,261.68 points on the Tokyo Stock Exchange.

Meanwhile, Hong Kong shares rose slightly to a new 4 1/2-year high. The Hang Seng Index rose 5.75 points, or 0.04%, at 15,450.95.

Toronto stocks closed higher Thursday, paced by strong performances in the materials and technology sectors. The S&P/TSX composite index finished up 28.45, or 0.27%, to 10,699.89.

Volume on the senior exchange was robust 302 million shares.

In the IT sector, up 1.24%, Nortel Networks continued on its recent run, gaining 16¢, or 4.42%, to $3.78, in heavy trading of 24.5 million shares.

The materials group was up 2.21%, largely on the higher price of gold, which closed at US$450.90, up $8.90, or 2% on the session. Placer Dome Inc. gained 62¢, or 3.45%, to $18.61.



The junior S&P/TSX Venture composite index finished up 72.74, or 3.96%, to close 1,908.69.

In New York, investors shrugged off soaring crude prices, putting faith in the strength of the U.S. economy.

The Dow Jones industrial average finished up 91.48 points, or 0.86%, at 10,685.89. The tech-heavy Nasdaq composite index rose 16.74, or 0.78%, to 2,174.55. The S&P 500 rose 8.68, or 0.71%, to 1,237.81.