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Stocks proved fairly resilient on the day as equities withstood a downgrade of Spanish debt.  The Fed’s continuing loose monetary approach was enough to give investors hope that the recovery will continue in risk assets.  Volume was once again very high and breadth was positive at 1.5:1.  High beta assets were more mixed on the day as small caps and technology underperformed the S&P 500.  Banks were strong outperformers on the session with 1%+ gains.

From Daily Futures:

U.S. Economy
The Federal Reserve concluded its two-day meeting and kept the federal funds rate unchanged at .25%, as expected. They do see signs of improvement, but said that “inflation is likely to be subdued for some time.” Except for one vote of dissent from Thomas Hoenig, they continue to say that they expect “exceptionally low levels of the federal funds rate for an extended period.” The June 2011 eurodollars are steady to lower.

The U.S. Treasury sold $42 billion of 5-year T-notes at a median yield of 2.49% with a bid-to-cover ratio of 2.75.

The Mortgage Bankers Association’s index of mortgage applications was down 2.9% last week. The average rate on a 30-year fixed mortgage increased from 5.04% to 5.08%.

Grains and Cotton
According to Bloomberg news, China’s Ag Ministry said that snow in northeastern China will delay planting by more than ten days. Also, the USDA said that China bought 115,000 tons of U.S. corn for the current 2009-2010 season. July corn finished up 10.25 cents at $3.64.

July wheat was down 3 cents at $4.875, pressured by today’s higher dollar.

Statistics Canada said that, as of April 1st, there were 11.6 million hogs in Canada, down 2.1% from a year ago. The number of sows totaled 1.3 million, down 5.7% from a year ago. June hogs were down .35 at 84.60.

July coffee jumped up 3.05 cents to $1.3390 after testing recent lows near $1.30 yesterday.

Sugar prices continue to fall farther than expected after the market worried about tight supplies just three months ago. July sugar closed down .51 at 14.86, its lowest close in nearly a year.

The U.S. Department of Energy (DOE) said that crude oil supplies were up 1.9 million barrels last week to 357.8 million barrels. Supplies of gasoline were down 1.2 million barrels while heating oil supplies were up 1.7 million barrels. June crude oil was up .78 at $83.22.

The DOE also said that refinery use increased from 85.9% to 89.0% of capacity last week. Over the past four weeks, gasoline demand was up 3.1% from a year ago and distillate demand was up 1.5% from a year ago.

June gold closed up $9.60 at $1,171.80, possibly helped by European investors looking for safer assets.

There is unconfirmed talk that European leaders are discussing ways of increasing aid to Greece. Also, Standard and Poor’s lowered Spain’s credit rating from AA+ to AA with a negative outlook. The June euro is trading lower.

Australia’s Statistics Bureau said that the consumer price index was up 2.9% in the first quarter from a year ago, the biggest annual gain since late 2008. The June Australian dollar is trading higher.

Japan’s Trade Ministry said that retail sales were up 4.7% in March from a year ago, better than expected and the largest annual gain since 1997. The June yen is trading lower.