The Dow Jones Industrial Average jumped 155.53 points, or 1.2%, to $12,651.91. Blue chips rose after labor and inflation data sparked speculation that the Fed Reserve would add quantitative easing. The Standard & Poor’s 500-stock index advanced 14.22 points, or 1.1%, to $1,329.10. Telecommunications and energy companies paced advances across all of the index’s 10 sectors.

The number of Americans making initial claims for unemployment benefits unexpectedly rose, while the prior week’s figure was revised higher. Meanwhile, U.S. consumer prices fell in May, in line with expectations, as plunging gasoline costs offset higher rents and medical-care prices. Excluding food and energy, consumer prices rose 0.2% from April, also matching economists’ forecasts.

Yields on Spanish 10 year bonds surged near 7%, an all time euro high, after Spain was downgraded by Moody Investors.
Meanwhile, yields on 10-year Spanish government bonds surged to 6.958%, according to electronic trading platform Tradeweb, after Moody’s Investors Service downgraded Spain’s debt three notches to the brink of junk territory late Wednesday.

Asian markets were broadly lower after the downgrade of Spain. Japan’s Nikkei Stock Average lost 0.2% and China’s Shanghai Composite gave up 1%. Crude-oil futures added 1.6% to settle at $83.91. Gold futures edged up 30 cents, or less than 0.1%, to finish at $1618.40.

In other corporate news, U.S.-listed shares of Finland’s Nokia (NOK) dropped 16% after the handset maker announced a shake-up of management and said it would cut an additional 10,000 jobs by the end of next year as it deals with increased competition. Cabot Oil & Gas jumped 8.6%, alongside a rally in natural gas prices after U.S. inventories of the fuel rose less than expected, suggesting improved demand.

Thomas Doherty is an undergraduate at Villanova University majoring in Finance and Economics. Thomas@KeeneOnTheMarket.com

Dow Jones Industrial Average futures rose 121.00 points (.97%) to 12550.00, S&P 500 futures rose to 1320.25, up 11.50 points (.88%), and NASDAQ futures rose 15.00 points (.59%) to 2537.50.

WTI crude futures rallied $1.10 to 83.72 and gold futures traded sideways, gaining 10 cents and traded at $1619.50.

Energy stocks moved higher as crude rallied., Exxon Mobil Corp. (XOM) rose 1.02% and Chevron (CVX) rose 1.07%.

Home Depot rose 2.26%, the largest increase in the Dow.

Nokia (NOK) dropped over 13% after the management decided to cut 10,000 jobs and shut down factories by the end of next year due to increased competition.

The morning wrapped up with a record breaking 30-Yeat Treasury auction. The treasury sold $13 billion in 30-year bonds at a yield of 2.72%, down from April’s 3.06% auction outcome. The Bid to cover also decreased at today’s auction with a bid to cover ratio of 2.4, down from 2.73 in April.

David Cornes holds a degree in economics from the University of Montana.

Trade of the Day : (KBH) Selling the KBH Jul 7-6 Put Spread for $0.27

Risk : $73 per 1 Lot

Reward: $27 per 1 Lot

Bearish to nuetral outlook

Paper sold 13,000 Jul7 7 puts

UPDATE 6.27.2012  With the stock rallying higher, this Put Spread is worth $.06.  Leaving this trade on and moving to the next trade.

UPDATE 7.2.2012 This Spread is worth $.04, but I will be leaving it on until expiration. 

Limited After reducing its shares in Rubicon Minerals (RBY), due to its lack of interest in last year’s investment in Runicon’s Red Lake Camp in Ontario. Last year Rubicon invested $70 million in this area as a long term investment, only to have a substantial portion sold off this year. Rubicon’s interest in this project have been mostly profitable and in line with future goals, however, we are not sure why Agnico Eagle is reducing ownership in the company. Some speculate that Angnico-Eagle is having internal conflicts that played a role in this transfer of ownership, however Angnico is not in a bad position financially, In my opinion, they are just restructuring their strategy.

This morning gold futures were trading at $1616.50, down $2.90 (-0.18%).

David Cornes holds a degree in economics from the University of Montana

The Hang Seng also finished low just over 1% with Espirit Holdings again finishing with double digit
losses down 12.43%.

The FTSEurofirst dropped .4% as Spain was downgraded by yet another rating agency, this time Moody’s
to Baa3 from A3. Nokia, with high volume as of late, dropped 5.4% on announcement of job cuts
and warnings of 2nd quarter job loss. Financials are currently outperforming the market however, are
beginning to slag.

In the US foreclosures are starting up again with a 16% rise in May from a year ago May or over 9.1%
from April.

In futures Crude is slightly up, still below $83, and silver just under .5% while gold and natural gas are
currently slacking.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market.
Comments can be directed to ryghcw19@uww.edu

Concerns about the strength of Italy’s economy moved to the forefront in late afternoon, amid trader jitters about the demand for Italy’s bonds ahead of its auction. In addition to US markets losing ground, European markets also faltered in the afternoon as the Stoxx Europe fell -0.4%, after initially being up 0.4%.

Another reason for the market concern has been Greece. With their elections on Sunday, many investors are watching the Greek election very closely and expect the outcome to have a heavy influence on the market.

Crude-oil futures fell 1.2% to $82.35 a barrel, while gold futures rose 0.3% to $1618 an ounce. The U.S. dollar lost ground against the euro and the yen.

In equity news, Dell led the S&P, rising 2.3% after the computer company announced that they plan on paying quarterly dividends of $0.08 per share. Johnson & Johnson (JNJ) also gained as the health provider closed its $19.7 billion bid for Synthes medical. Finally, Facebook (FB), mirroring the market, lost -0.47% after spending much of the day in the green.

Thomas Doherty is majoring in Finance and Economics at Villanova University. Thomas@KeeneOnTheMarket.com

S&P 500 futures were slightly down on the day at 1317.50, down 2.5 points (-0.19%), Dow Jones Industrial Average futures were down 17 points (0.14%) at 12497.00, and NASDAQ futures were up 4.5 points (0.18%) at 2549.50.

WTI crude futures are up 32 cents (0.38%) at $83.64 and gold was up $8.40 (0.52%) at $1622.20.

EUR/USD futures gained 1.06 cents and are trading at $1.2607.

Dell (DELL) rose over 4% this morning after announcing its’ first dividend plan of 32 cents a share.

Scotts Miracle-Gro Co. (SMG) traded down to $39.03, down $4.02 (-9.34%) as they expected to fall short on their previous fiscal year guidance. SunTrust analysts said with regards to the poor 2011 gardening season, “”not only does this bring the health of the category into question, but we also believe Scotts will need lower ad spending and stepped-up pricing to improve bottom-line results.”