Trader's Highlight

DJI-NEW YORK, Feb 10 (Reuters) - U.S. stocks were lower on Thursday and the Dow was on track to snap an eight-day rally, but hopes for a possible resolution in Egypt to the political unrest that has gripped the country for more than two weeks helped equities pare earlier losses.

Stocks started the session lower after tech bellwether Cisco Systems Inc gave a weak outlook and reported eroding margins, stoking fears about falling public sector spending and increasing competition.

The Dow Jones industrial average <.DJI> was down 39.40 points, or 0.32 percent, at 12,200.49. The Standard & Poor's 500 Index <.SPX> was down 2.81 points, or 0.21 percent, at 1,318.07. The Nasdaq Composite Index <.IXIC> was down 7.76 points, or 0.28 percent, at 2,781.31.

NYMEX-NEW YORK, Feb 10 (Reuters) - U.S. crude futures retraced higher in post-settlement trading on Thursday after Egypt's President Hosni Mubarak said he would transfer the reins of power to his vice president, but not step down.

The speech sparked more worries that Egypt's unrest would spread across the Middle East and disrupt oil supply movement.

On the New York Mercantile Exchange, March crude settled at $86.73, up 2 cents, trading from $85.96 to $87.90.

CBOT-CHICAGO , Feb 10 (Reuters) - Chicago Board of Trade grain and soy complex close on Thursday.

CBOT-SOYBEANS - March down 18 cents at $14.33 per bushel. Profit-taking, a firm dollar, fund selling, corn/soy spreading weigh on soy in addition to pressure from a low number for old-crop soy in the USDA's export sales report.

CBOT-SOYOIL - March down 0.70 cent at 59.04 cents per
lb. Following soybeans with weak crude oil and a downturn in palm also weighing.

FCPO-KUALA LUMPUR, Feb 10 (Reuters) - Malaysian palm oil futures ended off three-year highs hit earlier on Thursday as traders booked some profits after a slew of industry data showed tight vegetable oil supplies at a time when demand has picked up.

Industry regulator Malaysian Palm Oil Board said January palm oil stocks fell to a six-month low, as floods and heavy rains curbed output.

The report comes hot on the heels of U.S. Department of Agriculture (USDA) data showing tighter soyoil stocks and a lower forecast for Argentina's soy crop that earlier suffered a dry spell.

The benchmark April crude palm oil contract on the Bursa Malaysia Derivatives Exchange rose as much as 0.9 percent to 3,967 ringgit ($1,306), a level not reached since March 2008.

The contract later settled 0.1 percent lower at 3,926 ringgit a tonne. Overall volumes more than doubled to 35,028 lots at 25 tonnes each, compared to the usual 15,000 lots. Credit Suisse said in a note that foreign participation in palm oil futures are at record high and the market could be vulnerable to profit-taking.

REGIONAL EQUITIES-BANGKOK, Feb 10 (Reuters) - Southeast Asian stock markets fell on Thursday amid rising inflationary pressures that triggered more foreign outflows and dealt a big blow to market heavyweights, including banks.

Market investors were cautious about a possible cool down in regional growth in response to the tightening of monetary policies in Asian countries after interest rate increases by China early this week and Indonesia last week.

Sharemarkets tumbled across the region in line with broad Asian stocks, which suffered a second session of sharp losses on Thursday after the U.S. central bank chief signalled the recovery in the world's biggest economy was still fragile.

Flows to Southeast Asia were mixed on Thursday. Malaysia suffered $242 million outflows, followed by Thailand's $91 million outflows, exchange data showed.

Turnover in Singapore and Malaysia was 1.5 times their 30-day average. Thai turnover was relatively weak at 0.75 times the 30-day average, similar to Vietnam's 0.73 times.

Southeast Asia's biggest developer CapitaLand , which is listed in Singapore, was down 2.6 percent, extending its losses on Wednesday after China's tightening stoked concern over moderating Asian demand that could hurt Southeast Asian companies exposed to China.