Last week NEGATIVE economic news exceeded POSITIVE economic news.  The
markets reacted with additional volatility although they finished little
changed.  

Below is a succinct list of last week’s
events:

Positives:

1)
Spanish bond yields fall about .5% across their curve. Italian yields lower but
not as much. Will the European Financial Stability Facility and then the
European Stability Mechanism buy sovereign bonds? Portuguese 10 yr yield falls
1% and 2 yr down 1.9% on the week
2) June Euro region mfr’g and services composite index unchanged at 46, well
below 50 and points to clear slowing but was a touch better than expected
3) Lack of a negative rather than a positive but Syriza loses in Greece
4) National Association of Home Builders home builder survey hangs at 5 yr high
at 29 but remains still well below breakeven of 50
5 From construction standpoint, housing permits rise to most since Sept ’08.

Negatives:

1)
German business confidence index falls to lowest since Mar ’10 in June
2) German investor confidence in their economy shows biggest one month drop
since Russian debt mess in Oct ’98
3) German mfr’g Purchasing Managers Index falls to lowest since June ’09
4) French business confidence falls to lowest since Mar ’10
5) Italian consumer confidence drops to record low (dating back to ’96)
6) Switzerland and Denmark both sell short term debt with negative yields,
great for them, sign of panic and fear on the part of the buyers
7) HSBC preliminary June Chinese mfr’g falls to 48.1 from 48.4, a 7 month low
8) India’s struggle with inflation prevents Royal Bank of India from cutting
rates to help slowing economy
9) Philly mfr’g falls to -16.6 from -5.8, well below estimate of zero and
follows weakness in NY region
10) Initial Unemployment Claims at 387k, 4th week in a row 380k+ and 4 week
average rises to highest of the year
11) May Existing Home Sales total 4.55mm annualized, a touch light and number
of months supply moves to most since Nov ’11.  Source:  The Big
Picture