Daily Market Commentary for June 10, 2011

As of mid day today, DOW had dropped below 12,000 amidst strong selling pressure. (read more at Millennium-Traders.Com)
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Data from China additionally added to the selloff after reports showed China's trade surplus for May expanded, though the pace of growth was slower than expected, as export growth cooled. The slowdown of the global economy continues to takes its toll on the financial markets. China's trade surplus for the month totaled $13.05 billion, compared to April’s $11.4 billion per the General Administration of Customs with results coming in well below the average projection for an $18.6 billion surplus. Exports for the month were up 19.4% from a year earlier, easing from a 29.9% rise in April and less than a 20.4% rise suggested by surveys. Imports in China climbed 28.4%, faster than April’s 21.8% and above the survey’s expectation for a 22% gain.

European stock markets fell again on Friday, posting a loss for the week, pressured by worries about the global economic recovery and the long-running euro-zone debt crisis. The weakness in the European markets came after Chinese trade data reinforced the case for further interest-rate hikes. In London, the FTSE 100 index dropped 1.6% to end at 5,765.80. The Greek ASE Composite index dropped 0.8%, including a 3.1% fall for National Bank of Greece. The DAX 30 index in Germany fell 1.3% to 7,069.90. Investors focus is now shifted to inflation and other economic figures for May which is scheduled for release next Tuesday.

The Travelers Companies (NYSE: TRV) was a center of attraction today, down 3% into early afternoon trading. The company reported today to slow down its share repurchase program as it contends with the fallout from a series of major disasters over the past few months. Travelers estimates the catastrophes in April and May, including tornadoes and hail storms, could lead to losses from $1 billion to $1.05 billion. Losses are approximately equal to what Travelers spent in the last two years combined. Internal expectations for the company was for losses of $450 to $500 million after taxes for all of 2011, CEO Jay Fishman told investors on Friday. In a statement issued by the company, “As a matter of prudence the company has limited its common share repurchases due to the catastrophe losses.” Travelers now expects total repurchases in Q2 to be less than $250 million, versus $1.4 billion in the same quarter last year.

Lululemon Athletica (NasdaqGS: LULU) was higher by 5% into mid-afternoon trading after reporting profit rose 70% in first fiscal quarter on strong demand for its pricey yoga and athletic wear. Company also raised its full year guidance.



Economic data released today:

Import Price Index: U.S. May Non-Petroleum Import Prices +0.4%; U.S. May Petroleum Import Prices -0.4%; U.S. May Import Prices +0.2%; Consensus -0.7%.


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