Dollar Falls, Metals And Energies Rise

In today’s economic news,
Retail Sales growth came in below expectations

Initial Jobless Claims fell less than expected (report)
and Business Inventories rose more than expected (report).

Treasuries closed lower, weighed down by the government sale of $13 Bln in 10-yr
T-notes. As bond prices moved lower, yields rose to test the highs set last week
with the 10-yr yield closing at 5.155%.

The US Dollar Index closed lower for the third consecutive day, giving back
gains from earlier in the session. The Dollar has been heading straight down for
the past month, as you can see from the chart of the Dollar Index below. The
Euro hit a one-year high versus the Dollar today but the day’s biggest gainer
was the British Pound which rose more than 1% against the Dollar.


The metals continued to benefit from the Dollar’s weakness, with Gold closing at
a new contract high of $721.50. Silver soared to a new contract high, along with
Copper, which closed at a new all-time high.

Unleaded Gas and Heating Oil
near contract highs, Crude Oil closes above $73

June Crude Oil futures rose for the third
consecutive day, closing at $73.32. Unleaded Gas and Heating Oil neared new
contract highs.

Natural Gas continued to be the laggard among the group, erasing yesterday’s
gains to close near contract lows after the EIA reported a rise in supplies.

In the softs, Orange Juice +2.00%, Cotton +1.72% and Sugar +1.55% were the best
performers. While Coffee fell 4.00% to close at a new 2006 low.

Illinois senators Barack Obama and Dick Durbin joined a number of other senators
in writing a letter to President Bush urging him not to increase ethanol imports
). Read James Cordier’s blog on Sugar and Ethanol


All the softs closed higher, except for Soybean Meal.

Pork Bellies was the best performer among the meats, rising 3.08%.

Economic News

Retail Sales Up 0.5% For April; Ex-Autos Up 0.7% (report)

Initial Jobless Claims Down 1,000 To 324,000 (report)

Business Inventories Up 0.7% For March (report)

EIA – Natural Gas Stocks Rise 85 Bcf

For more reports and analysis go to our

Ashton Dorkins

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