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First quarter GDP revised upward to 1.9%

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Stock futures rose to their best levels of the session after the Commerce Department said the economy grew at an upwardly revised 1.9% annual rate in the first quarter, which is a +0.3% revision from the preliminary 1.6% reported. The first quarter Chain Deflator remained unchanged at 2.5%.

The upward revisions in first quarter GDP were largely due to stronger consumer spending and higher levels of exports compared with the first estimate, which were somewhat offset by weaker business investment and higher imports.

While the GDP data gave an immediate boost to stock futures, those gains were limited somewhat by the Labor Department's report of weekly jobless claims. For the week ended May 24th, the Labor Department said jobless claims fell by 4,000 to 424,000, which missed economists forecast of 420,000. The prior week's data was revised lower from 433,000 to 428,000.

As futures traders digest this morning's data, S&P futures (sp03m) currently show a 2.9-point gain at 954.90. NASDAQ futures (nd03m) are higher by 3 points at 1,177.50, while Dow futures (dj03m) are rising 33 points to 8,805.

Fair value for the S&P 500 today is $-0.11. That price will not change during the session. HL Camp & Company has their computers set for program buying at $1.08 and set for program selling at $-1.24. Fair value for the NASDAQ-100 today is $1.20.

The bond market is finding a bid after two days of what looks to have been profit taking. The shorter-dated 5-year Treasury June futures contract (fv03m) are rising 4/32 to 115'070, the 10-year June futures contract (ty03m) are higher by 6/32 to 118'210 and the longer-dated 30-year June futures contract (us03m) is up 4/32 at 119'210. This has the 5-year YIELD ($FVX.X) falling 2.7 basis points to 2.309%, the benchmark 10-year YIELD ($TNX.X) down 3.5 basis points to 3.396% and 30-year YIELD ($TYX.X) off fractionally to YIELD 4.411%.

The dollar is relatively unchanged against major foreign currencies with the U.S. Dollar Index (dx00y) 93.48 +0.05% gaining 0.05.

Jeff Bailey

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