Bond & equity report for March 31

SUMMARY OF UPCOMING DATA 03/31/10

· 8:15 AM ADP EMPLOYMENT REPORT

· 9:45 AM CHICAGO PMI INDEX

· 10:00 AM US FACTORY ORDERS

· 10:30 AM EIA INVENTORY (CRUDE, PRODUCTS)

· DATA RESULTS 03/30/10

· US CONSUMER CONFIDENCE (52.3/50.0)

US DEBT REVIEW AND OUTLOOK

U.S. Treasuries drifted higher on Tuesday as support for most of the US Treasury complex held, allowing for a slightly upside bias. A lack of new supply issues (no major Treasury auctions this week) and a midsession pullback in equities from early gains allowed Treasuries recover to test near term resistance level within the expected narrow channel that the complex should traverse this week. Early pressure from a stronger than expected consumer confidence figure faded after equities failed to break above near term resistance and the digestion of the numbers left the market unsure of potential reaction to employment data and the tone of sentiment as the wrap up of the 1st quarter occurs this week. Failure to break recent support on Treasuries prompted some short covering and rebalancing of portfolios using Treasuries. Tuesday’s session was also prone to light volume and essentially was a mirror image of Monday’s trading. The market will likely react to a brief catalyst of employment data speculation for the week.

The technical outlook for June 30 Treasuries continues to remain bearish in the medium to long term, though some short covering rallies will likely continue. Initial resistance remains in place at 116-04, with a possible upside target of 116-17 fueled by a gap recovery rally. Support remains in place at 114-28, with a mid to long term downside target of 113-17.

U.S. EQUITIES REVIEW AND OUTLOOK

Tuesday’s equity session was even more lackluster than Monday’s out of the gate pullback. Early gains driven by a better than expected reading on US consumer confidence failed to hold as market sentiment appears to be looking for clues from what consumer actually do vs. what they say. The shortened trading week and expectations of unemployment data that essentially can’t be fully digested and reacted to until next week-so the market wait and try to decide if any catalyst this week could ramp up volume and volatility.

Tech stocks remained the leading sector, as continued reports that Apple is close to developing an I Phone for Verizon prompted broad support for companies that provide perceived value and products for the sector. Commodity and industrial stocks were essentially flat.

Technically, June S&P futures outlook remains the same- a degree of cautious optimism that remains vulnerable to selling into strength for the time being-though expecting an upward bias for early part of this week. Market should retest 1173.00 resistance levels; with 1178.00 and 1183.00 as near term top of range. 1156.75 should remain as a strong support.

US DEBT FUTURES

OPEN

HIGH

LOW

CLOSE

CHANGE

US M0 (US 30 YRS)

115-14

115-24

115-00

115-21

+5/32nds

SP M0 (S&P 500)

1170.00

1173.50

1164.50

1169.40

+0.60

Prepared by Rich Roscelli & Paul Brittain. PLEASE VOICE YOUR MARKET OPINIONS, THOUGHTS, AND QUESTIONS. EMAIL TO RICH@BINVSTGRP.COM Additional Information can be found at WWW.WHITEHALLVEGAS.COM

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Whitehall Investment Management, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

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