MARKET COMMENTS Tuesday, June 4th, 2013

June E-mini S&Ps (ESM13 +0.06%) this morning are down -1.00 point (-0.06%). The S&P 500 index on Monday sold off to a 3-week low after the May ISM manufacturing index unexpectedly contracted, but then recovered its losses and finished higher after Atlanta Fed President Lockhart said the economy isn’t strong enough to justify tapering bond purchases. Closes: S&P 500 +0.59%, Dow Jones +0.92%, Nasdaq 100 +0.30%.
September 10-year T-notes (ZNU13 +0.01%) this morning are up +3.5 ticks. Sep 10-year T-note futures prices on Monday erased early losses and closed higher after the May ISM manufacturing index fell to a 3-3/4 year low and fueled speculation the Fed will continue its bond buying program. T-note prices had weakened early in the session after San Francisco Fed President John Williams hinted the Fed may end its QE program by the end of the year. Closes: TYU3 +5.5, FVU3 +3.25.
The dollar index (DXY00 +0.10%) this morning is up +0.018 (+0.02%). EUR/USD (^EURUSD) is up +0.0010 (+0.08%) and USD/JPY (^USDJPY) is up +0.44 (+0.44%). The dollar index on Monday tumbled to a 3-week low and settled lower after an unexpected contraction in the May ISM manufacturing index (-1.7 to 49.0) fueled speculation the Fed will be forced to maintain its dollar-negative bond buying program. EUR/USD posted a 3-week high and received a boost after the Eurozone May manufacturing PMI was revised higher. Closes: Dollar index -0.719 (-0.86%), EUR/USD +0.00749 (+0.58%), USD/JPY -0.917 (-0.91%).
July WTI crude oil (CLN13 -0.62%) this morning is down -43 cents a barrel (-0.46%) and July gasoline (RBN13 +0.25%) is up +0.0052 (+0.19%). July crude oil and gasoline on Monday fell to 1-month lows on Chinese demand concerns after the China May HSBC manufacturing PMI was revised down to an 8-month low of 49.2. However, energy prices recovered and closed higher after the dollar index fell to a 3-week low when the May ISM manufacturing index unexpectedly contracted and bolstered speculation the Fed will maintain its stimulus measures. Closes: CLN3 +1.48 (+1.61%), RBN3 +0.0302 (+1.10%).