SUNNY SKIES WITH CONTINUED RISK OF TORNADOES

Markets surged to end a rough second quarter with the S&P closing at its highs for the day.  For the quarter, the S&P was down a little over 3% but it could have been much worse if not for today's rally.  After drifting lower yesterday with the ObamaCare ruling and disappointing economic news, the market's surged in the last hour of trading as news of positive developments at the European Summit leaked out.  The strength carried into today with the markets gapping up at the open and adding to their gains throughout the day.  While the Europeans still have a host of issues to contend with, the Summit produced a level of cooperation and agreement not seen in several months and gave hope that the contending governments will work together to find solutions to the enormous issues that confront the region.  Talk is cheap and now Europe will need to implement the agreements that were reached but there is room to be optimistic.

In the US, the S&P closed today at a couple of significant technical levels - the highs of 2 weeks ago and for those that are interested in Fibonacci numbers right at the 61.8% retracement level.   Oftentimes, the markets strengthen at the end and beginning of months (particularly at quarter end), with money coming in from retirement plans and end of quarter window dressing from portfolio managers.  We will be watching closely early next week to see if the market can follow through on today's gains.  With the 4th of July falling in the middle of the week, trading will likely be skewed with many traders taking some time off.   We are not ready to give the all clear but the skies are certainly a lot brighter today than they were last week.  Hopefully there will be a little more clarity with the next issue of the BAM Market Wrap.  We hope you have a wonderful 4th of July with friends and family.  Stay cool...