Safe-haven buying continues to flow into fixed income assets

Safe-haven buying continues to flow into fixed income assets that are now offering historically low returns underscoring the concern over sovereign debt contagion that is plaguing the European Union. The U.S. 10-year not has broken through the 1.60% (now 1.598%) and German Bunds are now yielding 1.27%. Spain is wondering where they are going to find nearly €100 billion to fund a bailout of its banking system amidst yields on the Spanish 10-year that are at 6.49% .  Anticipation of next month’s elections in Greece have many worried that the country’s exit from the euro is becoming more and more inevitable. If you’re looking for any positive news don’t look across the pond. U.S. initial jobless claims numbers rose 10,000 to 383,000 and first-quarter GDP was revised to 1.9% from 2.2%. The ADP report on private sector jobs is expected to show 157,000 people added to the payroll in May. However, the ADP report is simply regarded as a preview to the big show… the government’s monthly jobs report, due tomorrow, that is expected to show unemployment remaining at 8.1%.

 

 

Metals	Last	%Change	Low	High
Au-Aug	1570	0.28%	1560.1	1572.6
Pt-Jul	1409.1	0.54%	1393.2	1414.6
Pd-Jun	606.2	0.39%	602.75	609.80
Ag-Jul	27.985	0.01%	27.725	28.190
London	AM	PM	Minor	PGMs
Au	1567.5	-	Rh	1260
Pt	1412	1405	Ru	115
Pd	610	611	Ir	1100
Ag	28.1	DJI	12430.15	10.29
Currencies
	USD	EUR	JPY	GBP
USD	0	1.2398	0.012724	1.549
EUR	0.8065	0	1.02628	1.2494
JPY	78.59	97.44	0	121.74
GBP	0.6456	0.80039	0.8214	0
Crude Brent	103.37	Comex Copper	346.35
Crude WTI	87.74	Nat Gas	2.395
*THESE PRICES ARE FOR INDICATION ONLY CALL FOR QUOTES

The extended weekend in the U.S. seems to be just what the doctor ordered

There was a report over the weekend that a 16 year-old had solved a mathematical problem that stumped Sir Isaac Newton and has since baffled the world’s great minds for over 300 years. It had something to do with the angle of trajectory of a ball when subjected to gravity and wind resistance. However, the 16 year-old didn’t stop there, he also ventured to explain what happens when a ball hits a wall. Now, that’s all well and good but unless his newly derived equations can keep home prices in the U.S. from hitting the floor, keep the Eurozone together and help China maintain sustainable growth he’s not exactly solving some of the world’s more pressing problems. Nonetheless, kudos for the accomplishment! The extended weekend in the U.S. seems to be just what the doctor ordered for investors as markets kick off the short week on the upside. Major financial institutions in Greece were able to replenish capital with the help of a bailout on Monday easing concerns, for now, that the country may exit the Euro. However, Spain and it’s banking system are raising new concerns following bank downgrades at the end of last week. China’s slowing economy had weighed on the psyche of investors but hopes of stimulus spending in the world’s #2 economy has eased those concerns as well. Home prices in the U.S. have hit new lows with average home prices down 2.6% from the same time last year. According to S&P/Case-Shiller, prices haven’t been this low since 2002.

 

Metals	Last	%Change	Low	High
Au-Aug	1582.3	0.72%	1572.9	1584.8
Pt-Jul	1447.8	1.47%	1429.4	1448.7
Pd-Jun	610.65	3.50%	588.70	613.55
Ag-Jul	28.590	0.72%	28.140	28.760
London	AM	PM	Minor	PGMs
Au	1573.75	1579.5	Rh	1280
Pt	1436	1435	Ru	115
Pd	606	608	Ir	1100
Ag	28.25	DJI	12602.26	147.43
Currencies
	USD	EUR	JPY	GBP
USD	0	1.2535	0.012584	1.5687
EUR	0.7978	0	1.00389	1.2515
JPY	79.46	99.61	0	124.659
GBP	0.6375	0.79908	0.8022	0
Crude Brent	107.75	Comex Copper	349.45
Crude WTI	91.79	Nat Gas	2.525
*THESE PRICES ARE FOR INDICATION ONLY CALL FOR QUOTES

U.S. markets are expected to be quiet today

U.S. markets are expected to be quiet today as traders position themselves ahead of the extended holiday weekend. So quiet, in fact, that even a COMEX margin cut in the yellow metal may not entice market participants to do anything that may jeopardize a relatively relaxing 3-day weekend. The CME Group decision will take effect at close of business on Tuesday, May 29^th. The Eurozone turmoil, highlighted by Greece and Spain’s economic uncertainty, coupled with the prospects of slowing growth in China will give investors plenty to think about over the next few days as they contemplate their next moves. Greece will lend some of the spotlight to Spain today amid an inevitable bailout request from the county’s fourth largest bank, Bankia. The request is expected to top €15 billon ($19 billion). Consumer sentiment in the U.S. hit a four-year high with the University of Michigan’s index climbing to 79.3 from Aprils 76.4. I suppose that when you can’t be any more pessimistic the only thing you can do is be optimistic? Best wishes to you all for a safe and enjoyable weekend.

 

Metals	Last	%Change	Low	High
Au-Jun	1565.7	0.53%	1550.7	1569.9
Pt-Jul	1422.6	0.03%	1412.0	1433.8
Pd-Jun	590.25	0.37%	584.70	595.00
Ag-Jul	28.320	0.58%	27.875	28.475
London	AM	PM	Minor	PGMs
Au	1560.5	1569.5	Rh	1340
Pt	1430	1423	Ru	115
Pd	592	590	Ir	1100
Ag	28.24	DJI	12504.25	-25.5
Currencies
	USD	EUR	JPY	GBP
USD	0	1.2528	0.012557	1.5671
EUR	0.7981	0	1.00228	1.2509
JPY	79.64	99.77	0	124.801
GBP	0.6381	0.7994	0.8013	0
Crude Brent	106.92	Comex Copper	345.6
Crude WTI	90.86	Nat Gas	2.566
*THESE PRICES ARE FOR INDICATION ONLY CALL FOR QUOTES