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Market Commentary for June 15, 2007


A positive day for the major indices as the DOW once again, purged into new record high territory. Trading ranges however, were very snug creating a not so friendly trading atmosphere for the active day trader. Trading volume was heavy as the market faced Quadruple Witching today. At the closing bell, here is how the major indices ended the session: the DOW (Dow Jones Industrial Average) posted a gain of 85.76 points to end the session at 13,639.48; the NYSE (New York Stock Exchange) posted a gain of 87.14 points to end at 10,013.93 the NASDAQ posted a gain of 27.30 points today for a close at 2,626.71; the S&P 500 moved higher by 10.13 points to end at 1,532.91 and the RUSSELL 2000 moved higher by 11.43 points to close at 848.19. The FTSE All-World Index ex-US (top Large/Mid Cap aggregate from over 2,700 stocks from the FTSE Global Equity Index Series (GEIS) which covers 90% of the worlds investable market capitalization) moved higher by 2.85 to close at 262.65 and the FTSE RAFI 1000 posted a gain of 46.69 points to close at 6,439.58.

Federal Reserve Board Chairman, Ben S. Bernanke commented today: home values affect household borrowing, spending; financing costs can amplify economic shocks; markets globally better able to absorb shocks; doesn't address policy outlook in prepared remarks; market's function is to overcome info problems; originators need incentives to make good loans and no comments on economy, monetary policy.

Net Foreign Buys Of U.S. Equities $27.4 Billion in April; Net Foreign Buys Of U.S. Corp Bonds $33.5 Billion in April; Net Foreign Buys Of U.S. Agency Debt $36.1 Billion in April; Net Foreign Buys Of U.S. Treasury Notes, Bonds $376.0 Million in April and Net Foreign Capital Inflow To U.S. $111.8 Billion in April.

ECB comments: financial system stability likely to be maintained; credit risk rating standards may have slipped; vulnerability to liquidity loss likely rising; no room for complacency on financial system risks; financial system stability likely to be maintained.

ECB Papademos comments today: rising yields no result of worse CPI outlook and no unfavorable conclusions from yield spike.

Economic data released for the day:

Consumer Price Index (CPI): The measure of the average price level of a fixed basket of goods and services purchased by consumers; monthly changes represent the rate of inflation. Data released today: U.S. May CPI Energy Prices rose by 5.4%; U.S. May CPI Food Prices rose by 0.3%; May Core CPI rose by 2.2% on the year, with the slowest gain since March 2006; U.S. May CPI Unrounded rose by 0.674%; U.S. May CPI Core rose by 0.149%; U.S. May CPI Excluding Food and Energy rose by 0.1%, compared to consensus of an increase by 0.2% and U.S. May Consumer Prices rose 0.7%, compared to consensus of an increase by 0.6%.

Current Account: International Trade balance in goods, services and unilateral transfers on a quarterly basis for the United States is measured by the Current Account. Trends in foreign trade are measured by the level of exports, imports and current account. Data released today: U.S. First Quarter Current Account Deficit reported as $192.6 Billion compared to consensus of $201.0 Billion and U.S. Fourth Quarter Current Account Gap was revised to $187.9 Billion versus $195.8 Billion.

Empire State Manufacturing Survey Index: A survey conducted by the New York Fed of manufacturers in the state of New York. The participants are from a variety of industries across the state and give their view of the likely direction of certain indicators, throughout the upcoming next six months. Data released today: U.S. Real Average Weekly Earnings fell by 0.2% in May; New York Fed’s June Mfg Index came in at 25.75 versus 8.03 in May; New York Fed June New Orders came in at 17.19 versus 8.02 in May; New York Fed June Prices Received came in at 9.57 versus 15.56 in May and New York Fed June Employment came in at 3.37 versus 9.67 in May.

Treasury International Capital: The flow of financial instruments into and out of the United States is tracked by this Treasury data. Tracking is included for: Treasury Securities, agency securities, corporate bonds and corporate equities. Released for April 2007, foreign demand for long term U.S. Securities reading came in at $84.1 Billion.

Industrial Production: The physical output of the nation’s factories, utilities and mines. The Industrial sector accounts for less than one fifth of the economy with a mostly cyclical variation. The usage of available resources amount utilities, mines and factories is the capacity utilization rate. A warning sign of inflationary pressure is detected by an increase operating rate. Data released today: U.S. May Industrial Production remained unchanged as compared to consensus of an increase by 0.1%; U.S. May Capacity Utilization fell by 0.2 Pt at 81.3% as compared to consensus of 81.5%; U.S. April Industrial Production Revised to an increase by 0.4% from an increase by 0.7% and U.S. April Capacity Use Revised to 81.5% from 81.6%.

Consumer Sentiment: 500 households are surveyed by The University of Michigan’s Consumer Survey Center, on their financial conditions and attitudes about the economy. The strength of consumer spending is directly related to consumer sentiment. Released today: University of Michigan Mid-June Current Index came in at 100.2 compared to reading in May at 105; University of Michigan Mid-June Sentiment came in at 83.7 compared to reading in May at 88.3; University of Michigan 12-Month Inflation Forecast rose by 3.5% compared to reading in May of an increase by 3.3% and University of Michigan 5-Year Inflation Forecast rose by 3.0% compared to reading in May of an increase by 3.1%.

Commodities Markets

The trend was mostly higher across the board today for the Energy Sector: Light crude moved higher by $0.35 today to close at $68.00 a barrel; Heating Oil moved lower by $0.01 today to close at $2.02 a gallon; Natural Gas moved higher by $0.12 today to close at $8.14 million BTU and Unleaded Gas moved higher by $0.04 today to close at $2.26 a gallon.

Metals Market ended the session mostly higher across the board today: Gold moved higher today for a gain of $2.80 to close at $658.70 an ounce; Silver closed higher by $0.10 at $13.26 an ounce; Platinum moved lower today by $1.00 to close at $1,286.00 an ounce and Copper moved higher today by $0.03 to end at $3.42 per pound.

On the Livestock and Meat Markets, the trend was mixed across the board today: Lean Hogs ended the day higher by 0.03 to close at 75.43; Pork Bellies ended the day lower by 0.75 to close 98.45; Live Cattle moved higher by 0.40 to close at 90.95 and Feeder Cattle ended the lower by 0.63 today to close at 106.95.

Other Commodities: Corn moved nicely higher today for a gain of 6.75 to close at 424.25 and Soybeans moved tremendously higher for a gain of 19.75 points to end the day at 880.75.

The e-mini Dow ended the session higher today, with a gain of 80 points to close at 13,768. The total Dow Exchange Volume for the day came in at 185,690 which are comprised of Electronic, Open Auction and Cash Exchange. Traders should review workshops available at the CBOT (Chicago Board of Trade) Educational in-person seminars schedules available on CBOT (Chicago Board of Trade) website.

Bonds were mostly higher across the board today: 2 year bond closed higher by 4/32 at 99 23/32; 5 year bond closed higher by 12/32 at 98 18/32; 10 year bond closed higher by 18/32 at 94 31/32 and the 30 year bond closed higher by 25/32 at 92 16/32.

The end of day results for the CBOT (Chicago Board of Trade) which is comprised of the total Exchange Volume for Futures and Options (EVFO) including Electronic, Open Auction and Cash Exchange ended the day at 4,922,891; Open Interest for Futures moved lower by 115,708 points to close at 10,037,460; the Open Interest for Options moved higher by 101,295 points to close at 8,554,509 and the Open Interest for OTC closed higher by 156 to end at 5,121 for a total Open Interest of 18,597,090 for a total loss on the day by 14,257.

On the NYSE today, advancers came in at 2,097; decliners totaled 1,143; unchanged came in at 107; new highs came in at 214 and new lows came in at 46. Gainers and losers for the day on the NYSE: Alliance Bernstein Holding LP (AB) shed 3.43 points to close at $88.30; Build-A-Bear Workshop Incorporated (BBW) plummeted sharply lower by 23.27% to shed 6.89 points for a closing price on the week at $22.72; Petroleo Brasileiro S.A. (PBR) tacked on another 3.12 points today to close the week at $121.46; MasterCard International (MA) bolted nicely higher on the trading session for a gain of 7.36 points for a closing price on the session of $157.65 and Rio Tinto plc (RTP) posted another gain on the Big Board by 5.66 points for a closing price of $308.41.

On the NASDAQ today, advanced totaled 1,805 decliners totaled 1,205; unchanged came in at 153; new highs came in at 110 and new lows came in at 45. Gainers and losers for the day on the NASDAQ: Hansen Natural Corporation (HANS) bolted higher on the trading day with a gain of 3.96 points to close the trading week at $43.90; Cardinal State Bank (CSNC) rallied higher on the session for a gain of 33.89% to tack on a gain of 4.29 points to close the week at $16.95; Penn National Gaming Incorporated (PENN) rallied higher on the day to post a gain of 21.59% to gain 11.04 points for a closing price on the trading week of $62.18 and Ceradyne Incorporated (CRDN) posted a favorable gain on the trading day of 4.03 points to end the day at $72.32.

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