Revenues from continuing operations were also a record 37.8 billion dollars, up 10 percent from last year's first quarter.

Cash flow from GE's operating activities was a record 6.7 billion dollars.

"We had a strong performance in the quarter highlighted by double-digit growth in earnings, revenues and cash flow," said GE Chairman and CEO Jeff Immelt.

"Driven by demand for our industrial equipment, momentum in healthcare and continued performance in our financial services businesses, we achieved nine percent organic revenue growth."

"We've started seeing a lot of money being repatriated into the Japanese equities market," said Matthew Smith, a manager at Smith Affiliated Capital. Japanese holdings of foreign bonds has fallen by $70bn so far this year, according to data from Japan's finance ministry.

Strong US retail sales in March and growing fears that high energy and commodity costs will soon start feeding into core inflation has also weighed on the bond markets.

Michael Taylor, senior economist at Lombard Street Research, said this year's sudden rise in 10-year yields risked tipping the US economy into a downturn.

"This could be the catalyst for a sharp correction in property prices and wean consumers off their credit binge," he said.

The cost of the average 30-year mortgage in the US has risen from 5.5pc last summer to 6.43pc this week. The housing boom is now the mainstay of the US economy. Last year Americans withdrew the equivalent of 6pc of GDP in home equity from their houses, spending most of it on daily bills, holidays and consumption.

Long-term yields remained near historic lows during 2005 despite a string of rate increases by the US Federal Reserve. The muted response of the bond markets dulled the impact of Fed tightening, prompting ex-chairman Alan Greenspan to talk of a "conundrum". "The conundrum just died," said Paul McCulley, an economist at the world's biggest bond trading company Pimco.

Joachim Fels, an economist at Morgan Stanley, said the conundrum had been caused by the easy money policies in Japan and Europe, creating a flood of global liquidity that continued to overrun the US credit markets long after the Fed began raising rates.

He said synchronised tightening across the world was now leading to bond sell-offs everywhere, with "nasty implications" for risky assets. "I think it is time to hunker down," he said. The bank is predicting a 7.9pc fall in European stock markets over the next six months.

JP Morgan Chase is forecasting a 13pc fall in Amer-ica's S&P 500 stock index, and 12pc fall in the FTSE 100. "Our big concern is the combination of rising bond yields, sustained high energy prices and weakness in US housing," said Abhijit Chakrabortti, the global equity chief.

Analysts said the surge in bond yields may have been accelerated by panic selling of Treasuries by hedge funds and US investment banks.

The price of the 10-year Treasury note fell half a point. Its yield, which moves in the opposite direction as the price, rose to 5.05 percent late this afternoon, from 4.98 percent late Wednesday. The yield on the 10-year note was at 4.59 percent as recently as March 1, and today's yield is the highest since June 7, 2002.

The 10-year Treasury note serves as a critical benchmark for the interest rates on all kinds of debt from the mortgage on homes to the yield on corporate bonds.

"It's more of a reason to believe that things are going to slow down," Joshua Shapiro, chief United States economist at MFR Inc., said referring to the housing market.

Already mortgage delinquencies have started climbing higher, though they remain near historic lows. In the fourth quarter of last year, 4.7 percent of all home mortgages were delinquent, up from 4.44 percent in the third quarter, according to the Mortgage Bankers Association of America. A delinquent loan is one on which monthly payments are past due for 60 days or more.

The average national 30-year fixed mortgage interest rate was 6.43 percent last week, up from 6.21 percent at the start of the year and 5.71 percent at the start of 2005. The introductory interest rate on a five-year adjustable-rate mortgage was up to 6.11 percent, from 5.78 percent in January and 5.3 percent a year ago.

For much of the last year, analysts and policy makers have been confounded by the United States' relative low long-term interest rates, given the Federal Reserve's campaign to push up interest rates by increasing its benchmark short-term rate, now at 4.75 percent. The Fed has signaled that it intends to raise its federal funds rate on overnight bank loans at least once more, to 5 percent, at its meeting next month.

Many experts believe longer-term interest rates in the United States have been kept low by the purchase of federal government debt by foreign governments and investors, particularly from Asia.

There are some early indications that foreign buying is easing. In the first week of April, for instance, the Japanese government spent slightly more than one-tenth as much on foreign bond purchases as it did on its average purchases for the comparable period from 2003 to 2005, said Wan-Chong Kung, a senior portfolio manager at First American Funds, a mutual fund company in Minneapolis.

"We have seen some moderation in buying from Asia and I think we will continue to see that," Ms. Kung said, noting that recent interest rate increases by central banks in Europe and Japan was conditioning investors to higher borrowing costs across the world.

But one analyst noted that at least a part of the increase in Treasury yields during the last couple of weeks may prove to be a temporary phenomenon. The yield on Treasury notes have consistently risen in the weeks before the April 15 tax deadline, presumably because Americans are selling notes and bonds to pay off their tax bill, according to an analysis of 40 years of data by Carl D. Steen, a market analyst at MFR Inc., a research firm based in New York.

"There is clearly propensity over the past 40 years for Treasuries to sell off throughout the month of April," Mr. Steen said.

"We're just in this terrific bull run right now, and the worries just steepen," said John Kilduff, analyst at Fimat USA. He added that as long as political tensions continue in Nigeria and Iran, crude futures next week are apt to break their previous trading record of $70.85 a barrel, reached Aug. 30 after Hurricane Katrina struck the Gulf coast.

Light, sweet crude for May delivery rose 70 cents to settle at $69.32 a barrel Thursday on the New York Mercantile Exchange. The Nymex is closed Friday for the Good Friday holiday.

Nymex crude futures are nearly $2 higher than their settlement price last Friday.

On London's ICE Futures exchange, Brent crude for June rose 71 cents to settle at $70.57 a barrel.

May gasoline futures rose 1.68 cent to settle at $2.1079 a gallon, after rising as high as $2.1119 - a level not reached since early September. May heating oil rose nearly a cent to settle at $1.9831 a gallon.

Tom Bentz, analyst at BNP Paribas Commodity Futures in New York, said the crude oil market "could be in for at least some kind of correction."

But he added "we're still in a bullish uptrend" due to underlying support from various supply concerns - the disruption of Nigerian crude supplies by rebels, the possibility of Iranian oil exports being halted due to political tension and domestic refineries having trouble turning enough crude into gasoline to meet consumers' needs.

In Nigeria, the world's 12th-largest oil producer, more than half a million barrels of crude a day are being blocked due to militant violence, and rebels have said they will target more supplies.

In Iran, the world's fourth-largest oil producer, no oil exports have been disrupted, but some market participants are worried they might be, depending on the U.N. Security Council's response to the Iran's defiance of council resolutions concerning the country's nuclear program.

Futhermore, as the summer approaches, not only are refineries still undergoing seasonal maintenance and recovering from last fall's hurricanes, they are also struggling with the prospect of tight ethanol supplies.

Ethanol is increasingly being blended with gasoline as refiners phase out their use of additive MTBE, which contaminates drinking water. The refiners have said they will stop using MTBE on May 5, when the federal requirement for a clean-air oxygenate is lifted as part of an energy law enacted last summer.

Inventories of crude oil rose in the past week to their highest level since early 1998, the U.S. Energy Department reported Wednesday. It was the third straight weekly build in crude stocks.

Petroleum products shrank, as refineries were operating at only 85.6 percent. Gasoline stocks fell 3.9 million barrels last week to 207.9 million barrels, and distillates - which include diesel and heating oil - fell 4.6 million barrels to 117.4 million barrels.

Meanwhile Thursday, natural gas rose about 18 cents to $6.990 per 1,000 cubic feet, after the U.S. Department of Energy reported that natural gas inventories grew by 19 billion cubic feet in the week ending April 7 to 1.7 trillion cubic feet - a bit less than most analysts had expected.

At 0633 GMT, spot gold was trading at $599.00/599.80 an ounce, up from $596.10/596.90 in New York on Thursday. It had climbed to a 25-year high of $604 on Tuesday.

"The trend remains bullish as funds are still keen to put their money into commodities that are performing well, and extremely strong silver and copper are giving support to gold," said Shuji Sugata, an assistant manager at Mitsubishi Corp. Futures and Securities.

Traders may test gold prices above $600, but the market lacks energy as many key centres are closed for Easter holidays. New York metals futures markets will be closed on Friday and reopen on Monday, while London precious metals markets will be closed on both Friday and Monday.

"For now the market is careful about taking new longs above $600," Sugata said. "Investors want to see gold stay above $600 for a while before building up new buy positions."

At this week's peak, gold was up more than 16 percent from the start of the year and more than 41 percent higher than 12 months ago. Prices have doubled in the last four years.

Since rising to $600 on Wednesday, gold has shied away from that level due to strong profit-taking.

But investors and investment funds are still reluctant to sell heavily due to concerns over high oil prices and Iran's nuclear aspirations.

Iran has said it would not back away from sensitive nuclear development work after announcing earlier this week it had enriched uranium to a level used in nuclear power stations. The United States believes Iran wants to build a nuclear bomb.

Oil rose in New York trade to near last year's record above $70 a barrel on tension in the Middle East. Gold is often considered a hedge against inflation.

"As long as geopolitical concerns are there, gold will be supported," Sugata said.

Technically, bullion will find support around its seven-day moving average (MA) of $595 and its 14-day MA of $588.

In Japan, benchmark most-distant February TOCOM gold ended at 2,319 yen per gram, up 26 yen or 1.13 percent from Thursday.

Other precious metals were confined to tight range trading due to the holidays.

Silver rose to $12.90/12.95 an ounce from $12.77/12.80 late in New York.

Platinum was little changed at $1,080/1,090 an ounce, compared with $1,075/1,080 in New York. Palladium was unchanged at $344/349 an ounce from late New York.

The global aspartame markets are facing structural oversupply, which has caused worldwide strong price erosion over the last 5 years. This has resulted in a persistently unprofitable business position for HSC. No significant improvements are expected in the near or foreseeable future. The decision to withdraw from this business is in line with DSM's Vision 2010 - Building on Strengths strategy, in which profitable innovative growth and value creation are key objectives.

The termination of HSC's business operations will affect around 100 jobs on the site in Geleen (the Netherlands). DSM expects to be able to re-assign the majority of these people to other positions. The social plan of DSM Limburg is applicable.

DSM does not expect the decision to have a material impact on its overall corporate financial performance in 2006. In Q1 2006 DSM will - in relation to this decision- record an exceptional item of approximately EUR 10 million net.

About DSM

DSM is active worldwide in nutritional and pharma ingredients, performance materials and industrial chemicals. The company creates innovative products and services that help improve the quality of life. DSM's products are used in a wide range of end markets and applications such as human and animal nutrition and health, cosmetics, pharmaceuticals, automotive and transport, coatings, housing and electrics & electronics (E&E). DSM's strategy, named Vision 2010 - Building on Strengths, focuses on accelerating profitable and innovative growth of the company's specialties portfolio. Market-driven growth, innovation and increased presence in emerging economies are key drivers of this strategy. The group has annual sales of over EUR 8 billion and employs some 22,000 people worldwide. DSM ranks among the global leaders in many of its fields. The company is headquartered in the Netherlands, with locations in Europe, Asia, Africa and the Americas. More information about DSM can be found at www.dsm.com.

About Holland Sweetener Company

Holland Sweetener Company (HSC) is a 50/50 joint venture between DSM (the Netherlands) and Tosoh (Japan) established in 1985. A unique aspartame process was developed using technology from both parents. In 1988, the first aspartame production unit was started up in the Netherlands, with subsequent expansions making HSC the largest aspartame producer in Europe. HSC supplies customers all over the world from its plant in the Netherlands via a global network of sales offices, agents and distributors.

Twinsweet™ was discovered in 1995 as part of a research program to develop aspartame-based new sweetener concepts for the food and nutraceutical industries. HSC has filed several patents on the Twinsweet™ product, the production process and the use of the product. More information about HSC can be found at www.hollandsweetener.com.