Equities bounce back on positive earnings, flight to safety, Bonds higher on Greek situation

Financials: June Bonds are currently 29 higher at 164’22, 10 Yr. Notes 6 higher at 129’23 and 10 Yr. Notes3 higher at 120’22. The prospect of a near term default on Greek debt has rallied the Bonds in a flight to quality. There is also talk of upping the Fed target for inflation to above the current target of 2% before raising rates. On the other side of the coin, the market continues to price in a defacto rate hike in the 4th quarter. We remain spread in Eurodollar futures long Sept.2015/short June 2017 initiated at 117 premium the Sept.2015, currently at a small loss trading at 115.

Grains: July Corn is currently 4’2 lower at 380’6, July Beans 3’0 lower at 976’6 and July Wheat 2’2 lower at 496’0. We are still on the sidelines, not seeing a reason as yet to be invoved in a speculative play. As for hedgers who are users, I would be a buyer in either July or Dec. Corn 10-15 cents below the market.

Cattle: Live and Feeder Cattle continued there recent slide with out us yesterday as we had covered short positions late last week. I am now willing to try the long side on any further breaks for short term trading. I feel that the outbreak of Bird Flu which will cause the euthanising of millions of chickens and turkeys could have a near term positive effect on beef and pork demand. We remain long out of the money calls and/or call spreads in June Hogs.

Silver: July Silver is currently 10 cents higher at 16.03 and June Gold 5.00 higher at 1199.00. If you did not take profits from recent longs purchased in the 1187.00 area in June Gold late last week my recommended stop of the 1191.00 area was hit yesterday.

S&P's: June S&P’s are currently 9.25 higher at 2100.00. We have taken profits from last week’s recommended short positions by either buying support in the 2070.00 area or being stopped out in the 2091.00 level. We are going to try the short side once again with an initial risk of a stop at 2023.00. If the market trades below 2089.00, lower your stop 2107.00.

Currencies: As of this writing the June Euro is currently 27 lower at 1.0717, the Yen 10 lower at 0.8378 and the Pound 5 lower at 1.4891. Given the uncertainty over Greece, I am on the sidelines.