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MARKET WRAP – STOCKS REBOUND ON FINREG PASSAGE

Stocks rallied 0.4% on the day after the financial regulatory bill proved to be less harmful than many banks initially assumed.  The bill was a shell of its initial proposal and does little to actually change the landscape of banking dramatically.  The threat of too big too fail remains and the Enron banking system is largely intact.  Naturally, banks loved the news as financial stocks rallied almost 2.5% on the day.  The current administration and Congress have become a pitiful display of doing what is in the best interest of Americans.  At every step of the way during this crisis they have chosen the banks over Main Street.  It’s beyond sad. This has truly become a crisis wasted.

From Daily Futures:

U.S. Economy
The U.S. Commerce Department said that real GDP was up .7% in the first quarter of 2010 and up 2.4% from a year ago, slightly less than last month’s estimate. The September U.S. T-bonds closed up 10/32nds at 125.11/32nds.

The University of Michigan’s consumer sentiment index increased from 73.6 to 76.0 in June, the highest in over two years.

Grains and Cotton
Yesterday’s 6 to 10 day forecast from the National Weather Service is calling for above average temperatures in the central U.S. That should be especially helpful to the areas that have had too much rain lately. December corn closed down 4 cents at $3.605, the fifth consecutive day lower.

On Wednesday, June 30th, the USDA will release its 2010 acreage report, the most important grain report of the year. November soybeans were steady at $9.12.

Clear skies are allowing the winter wheat harvest to pick up again. July wheat fell 6.75 cents to $4.562.

Livestock – Hog Count Less Than Expected
After the close, the USDA said that the U.S. had 64.400 million head of hogs and pigs on June 1st, down 3.6% from a year ago and less than expected. The March to May pig crop was down 4.7% from a year ago. August hogs closed up .67 at 83.92.

The USDA said that beef production totaled 2.09 billion pounds in May, down 4% from a year ago. Pork production totaled 1.62 billion pounds in May, down 6% from a year ago. August cattle were up .22 at 89.37.

After the close, the USDA estimated this week’s beef production at 505.2 million pounds, down 2.4% from a year ago. Pork production was estimated at 398.5 million pounds, down 2.8% from a year ago.

Sugar
October sugar closed up .20 at 16.39, the highest close in eight weeks, helped by today’s higher gasoline price.

Energies
It seems like a long shot, but August crude oil jumped up $2.35 to $78.86 with talk that an area of low pressure in the Caribbean may turn into a Gulf of Mexico storm early next week.

Metals
September copper closed up 8.70 cents at $3.1110, the highest close in three weeks, in spite of weak economic news and ongoing concerns about Europe.

August gold closed up $10.30 at $1,256.20, still seen as a safe haven from Europe’s problems.

Currencies
The September Australian dollar started lower, but closed up .61 at 86.68, one day after the Labor Party chose a new Prime Minister.

Japan’s deflation is not going away. The Statistics Bureau said that the consumer price index was down .9% in May from a year ago. The September Japanese yen closed up .0018 at 1.1201, the highest close in seven weeks.

France’s Statistics Agency said that real GDP was up .1% in the first quarter of 2010 and they expect growth of 1.4% for the whole year.

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