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Today was an enormously disappointing session for the bulls.  Investors were hoping for a big follow-thru day on the back of yesterday’s intra-day reversal, but a 1% morning rally failed to hold.  Stocks rolled over into the close of trading and finished with 0.6% losses.  Volume was heavy on the day and breadth was positive at 2:1.  Investors have been expecting a technical bounce for weeks now, but as the fundamentals remain entirely changed so too does the trend in markets.

From Daily Futures:

U.S. Economy
The U.S. Census Bureau said that new home sales were at an annual rate of 504,000 in April, up 14.8% from March and more than expected. So far in 2010, new home sales are up 18% from a year ago. July lumber closed down its $10 limit for the second consecutive day at $225.00.

The U.S. Commerce Department said that durable goods orders were up 2.9% in April, more than expected. Excluding transportation, orders were down 1.0%. The June 2011 eurodollars were down .035 at 98.61.

The Mortgage Bankers Association said that its index of mortgage applications was up 11.3% last week. The average rate on a 30-year fixed mortgage slipped from 4.83% to 4.80%.

The U.S. Treasury Department sold $40 billion of 5-year T-notes at a median yield of 2.07% with a bid to cover ratio of 2.71. The June U.S. T-bonds closed down 25/32nds at 124.15/32nds ahead of tomorrow’s monthly GDP report.

Grains and Cotton
July corn closed up 6.75 cents at $3.71, supported by hopes that China will be a buyer.

July wheat started the day higher, but ended unchanged at $4.605, weighed down by plentiful supplies and a healthy U.S. crop in the ground.

August cattle closed up .85 at 89.92, helped by relief from yesterday’s late comeback in the stock market.

The World Gold Council said that world mine production was up 5% in the first quarter of 2010 from a year ago while total gold demand was down 25%. August gold closed up $15.50 at $1,215.30.

In a press release, World Gold Council’s CEO, Aram Shishmanian said, “Currently, European gold investment demand is exceptionally strong, especially from German and Swiss investors. This is mainly attributable to concern over public debt levels in the Eurozone and the potential inflationary impact of the European Central BankÕs announcement of the US$1 trillion rescue packageÉ”

The U.S. Department of Energy (DOE) said that crude oil supplies were up 2.4 million barrels to 365.1 million barrels. Supplies of gasoline were down 200,000 barrels and heating oil supplies were down 500,000 barrels. July crude oil jumped up $2.76 to $71.51, helped by bargain-hunting.

The DOE also said that refinery use slipped from 87.9% to 87.8% of capacity last week. Over the past four weeks, gasoline demand was up 1.2% from a year ago while distillate demand was up 15.8% from a year ago.

An index of leading indicators in Australia was up .9% in March, stronger than expected. The June Australian dollar closed up .62 at 82.36.

it is hard to tell what is making the euro weaker – concerns about possible sovereign defaults or the supposed cure of reigning in its large budget deficits? The June euro dropped 1.17 cents to $1.2201, near its contract lows.

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