Apple Inc’s leader, Steve Jobs, is recovering and should be able to return to work before the end of June, The Wall Street Journal reported.

BHP Billiton Ltd will merge with Rio Tinto.

The FDIC wants to shake up Citigroup Inc’s top management, leaving CEO Vikram Pandit on thin ice. Friday is the firm's final day as a component of the Dow Jones industrial average.

General Motors Corp, which recently filed for bankruptcy, loses its place as a member of the Dow Jones industrial average after Friday's session. The carmaker has agreed to sell its Saturn unit to car dealership operator Penske Automotive Group.,

Lattice Semiconductor Corp upwardly revised its quarterly revenue forecast.

Toyota Motor Corp has increased production of its hybrid Prius by allowing overtime again.

-EMU monetary pol should focus on keeping interest rates low
-Risk of deflation in EMU is low due to commodity prices
-Recent euro rise, wider output gaps to weigh on prices
-Headline inflation to stay below 2% for some time
-EMU recovery likely to be slow, timing highly uncertain
-EMU officials must take more action to secure recovery
-EMU needs coordinated, resolute cleaning of financial system

Losses remain widespread, though financials (+0.2%) continue to show strength.
Treasuries are a bit mixed currently. The 2-year Note is down 4 ticks and yielding 1.37%. The 10-year Note is also down 4 ticks, but yielding 3.84%.

GBP/USD continues its robust tone into early afternoon, the pair extending gains to $1.6065 area on steady buying by UK and US names. Techs remind of resistance at $1.6080/84 (Former
Fibonacci level, High 27 May, $1.6180 - 5d ma).

The dollar rose to a one-week high versus the euro as investors raised bets the Federal Reserve will increase the target lending rate by the end of the year as the world’s largest economy recovers.
The dollar fell in the past three months except the yen on speculation the Fed’s purchase of up to $300 billion in Treasuries to support the economy will undermine the greenback.
The pound dropped 0.1% as the BBC reported that the Labour Party ran third in EU elections with 15.3 percent, down 7 percentage points from 2004. Labour lost to the Conservatives in Wales for the first time since 1918.
Sterling had its biggest weekly decline in three months last week as Brown rearranged his Cabinet amid a series of resignations and calls for him to quit. The currency advanced 14% in the past three months on signs the worst of the recession is over.
The euro fell against the dollar and yen after Standard & Poor’s downgraded Ireland’s sovereign credit rating for a second time this year.

1. Forecast uncertainty is currently particularly high
2. Many international fin institutions' risk-bearing capacity harmed

GBP/USD recovered to $1.5990/00 area. Supply earlier mentioned at $1.6000.

While US stocks are under pressure on the day, technicals are still supportive. In the S&P (currently down 1.16% at 929.22), larger support is not seen until 875, prior 2009 peak, which now acts as support. BAS/Merrill Lynch strategists say interim support is seen at 920, where the 200 day also comes in (918.28 Monday). On the downside, a break of 875 would target 845-825 initially. On the topside, the S&P may test 915-965 resistance zone.

EUR/USD stalled just shy of $1.3890 as volumes are unimpressive and pair continues to probe for new direction after the Friday/Monday sell-off. Offers eyed at $1.3900 area, bids back at $1.3800. Area of $1.3780 seen as key, techs traders remind that $1.3784 is 38.2% of $1.2889 to $1.4338, with traders eyeing a break there to allow for potential to $1.3720 and below.

Declining issues outnumber advancers by 4-to-1 in the S&P 500. The broad-based decline continues to counter the strength of financials (+0.5%). Overall trading remains rather choppy, but relatively range bound. The S&P 500 has spent most of the morning gyrating between 928 and 935.

Data:
05:45 Switzerland Unemployment Rate s.a. (May) 3.5%
05:45 Switzerland Unemployment Rate (May 3.4%
08:30 European Monetary Union Sentix Investor Confidence (Jun) -27,0
10:00 Germany Factory Orders n.s.a. (YoY) (Apr) -37,1%
10:00 Germany Factory Orders s.a. (MoM) (Apr) 0,0%

The dollar rose for a second day versus the euro as stocks in Europe declined and investors raised bets the Federal Reserve will increase interest rates by the end of the year as the economy recovers.
The U.S. currency gained most versus the New Zealand dollar and the Norwegian krone as the MSCI World Index dropped for a second day and Fed funds futures showed a 40 percent chance the central bank will lift its target rate to 0.5 percent by September. The yen advanced as reports showed bankruptcies declined and merchant confidence in Japan improved. The pound dropped for a fourth day against the dollar as Prime Minister Gordon Brown faced an attempt to oust him.
The yen rose against all of the 16 most-traded currencies after Tokyo Shoko Research Ltd. said corporate bankruptcies fell 6.7 percent from a year earlier. Confidence among Japanese merchants rose to a 14-month high in May, the Cabinet Office said in Tokyo. The Economy Watchers index, a survey of barbers, taxi drivers and others who deal with consumers, climbed to 36.7 from 34.2 in April, the highest level since March 2008.
The pound extended last week’s losses as Brown, after withstanding a rebellion in his Labour Party last week, faced a new attempt today by dissidents to oust him following a drubbing in European Union Parliament elections.
Sales at U.S. retailers increased in May for the first time in three months as demand for cars picked up, according to a Bloomberg News survey before the government report on June 11. Retail sales climbed 0.5 percent, according to the median estimate of the survey.

EUR/USD the pair remained under pressure therefore could test a mark $1,3800

-Confidence, trade improving; activity picking up
-In 2q 2010 gdp growth to approach positive territory
-Unemployment now a very serious matter of concern

European equity bourses are trading lower Monday, seeing mostly sideways movement following an initial drop, and with the Xetra-DAX underperforming. Mining stocks are easing lower on the back of weakness in the metals markets, with BHP Billiton (BLT) and Rio Tinto
(RIO) now leading losses. The oil and energy sector is also seeing similar losses, as crude prices retrace last weeks gains, with Total SA (FP) and BG Group (BG.) weighing heaviest. In London, banks are seeing significant losses, with Barclays (BARC) weaker amid talks surrounding it's iShares and BGI divisions, and with Lloyds (LLOY) underperforming after updates on it's rights issue. The FTSE -54.72 (-1.23%) at 4,383.84, CAC -54.85 (-1.64%) at 3,284.20, Dax -82.88 (-1.63%) at 4,994.15.

The dollar rose for a second day versus the euro as stocks in Europe declined and investors raised bets the Federal Reserve will increase interest rates by the end of the year as the economy recovers.
The U.S. currency gained most versus the New Zealand dollar and the Norwegian krone as the MSCI World Index dropped for a second day and Fed funds futures showed a 40 percent chance the central bank will lift its target rate to 0.5 percent by September. The yen advanced as reports showed bankruptcies declined and merchant confidence in Japan improved. The pound dropped for a fourth day against the dollar as Prime Minister Gordon Brown faced an attempt to oust him.
“The market is thinking things are looking slightly better and that’s dollar positive just now,” said Geoff Kendrick, a currency strategist in London at UBS AG, the world’s second- largest currency trader. “It’s also equities negative, because if the Fed hikes rates that’s bad for stocks.”
The yen rose against all of the 16 most-traded currencies after Tokyo Shoko Research Ltd. said corporate bankruptcies fell 6.7 percent from a year earlier. Confidence among Japanese merchants rose to a 14-month high in May, the Cabinet Office said in Tokyo. The Economy Watchers index, a survey of barbers, taxi drivers and others who deal with consumers, climbed to 36.7 from 34.2 in April, the highest level since March 2008.
“A raft of economic data now suggests that the Japanese economy has pulled out of the recession and may enjoy the most visible recovery among developed countries,” said Susumu Kato, chief economist in Tokyo at Calyon Securities, the investment banking unit of Credit Agricole SA. “The yen is likely to be bought.”
The pound extended last week’s losses as Brown, after withstanding a rebellion in his Labour Party last week, faced a new attempt today by dissidents to oust him following a drubbing in European Union Parliament elections.
“Investors are doing what they usually do when political uncertainty rises, they are selling pounds,” Carl B. Weinberg, chief economist at High Frequency Economics in Valhalla, New York, wrote in a report today. “The U.K. economy will remain in deep recession for a long time to come under any government.”
Sales at U.S. retailers increased in May for the first time in three months as demand for cars picked up, according to a Bloomberg News survey before the government report on June 11. Retail sales climbed 0.5 percent, according to the median estimate of the survey.

Resistance 3: Y100.70
Resistance 2: Y100.00
Resistance 1: Y99.60
Current price: Y98.52
Support 1: Y98.20
Support 2: Y97.20
Support 3: Y96.70
COMMENTS: The pair bargains in the field of former levels. The nearest resistance - Y99.60/70 (high of May). Above the important level is the area of Apr 10-12 high on Y100.70. The nearest support - Y98.20 (session low). Below loss can increase up to Y97.20 (May 28 high), and then - to a channel line from Jan 21 on Y96.70.

Resistance 3:Chf1.1170
Resistance 2:Chf1.1030
Resistance 1:Chf1.0895
Current price: Chf 1.0865
Support 1:Chf1.0900
Support 2:Chf1.080
Support 3:Chf1.0650
СOMMENTS: The dollar continues to become stronger. The nearest resistance - Chf1.0980 (session high). Above is probable growth to Chf1,1030 (38,2 % FIBO of Chf1,1740-Chf1,0590 falling) and further to Chf1.1170 (50,0%). The nearest support is level Chf1.0900 (Friday's high). Below possible falling to Chf1.0800 (May 22, 26 and 27 lows) and further to Chf1.0650 (Friday's low).

Resistance 3:$1.6190
Resistance 2:$1.6080
Resistance 1:$1.5980
Current price: $1.5932
Support 1: $1.5800
Support 2: $1.5750
Support 3: $1.5510
COMMENTS: The sterling updated low. The nearest support - session low on $1,5800. Below loss can increase up to May 22 low on $1.5750, and then - to $1.5510 (38.2% FIBO of $1,3650-$ 1,6660 growth). Session high are the nearest resistance ($1.5980). More important level is $1.6080 (June 4 low). Overcoming of this level will strengthen the bull impulse and will open road to $1.6190 (MA(200) for Н1).

Resistance 3: $1.4160
Resistance 2: $1.4040
Resistance 1: $1.4000
Current price: $1.3880
Support 1: $1.3840
Support 2: $1.3740
Support 3: $1.3630
COMMENTS: The euro continues Friday's falling. The nearest strong support is located on $1.3840 (area of May 20 high). Below correction of a rate can reach $1.3740 (50% FIBO of $1.3420-$ 1.4050 growth) and to stronger on $1.3630 (channel line of support since Apr 22). The nearest resistance is on $1.4000 (session high). Overcoming of this mark will open road to $1,4050 (22.05.09 high). Above growth is possible to $1.4160 (50,0% FIBO $1,6030-$ 1,2330 falling).

USD/JPY
Offers Y99.70/75, Y99.50/55, Y98.86/90
Bids Y98.30

GBP/USD
Offers $1.5845/55, $1.5880, $1.5920/25
Bids $1.5800, $1.5760/50

EUR/GBP
Bids stg0.8750/40, stg0.8725/20

Data:
05:00 Japan Eco Watchers Survey: Outlook (May) 43.3
05:00 Japan Eco Watchers Survey: Current (May) 36.7

The dollar rose against the euro as stocks fell around the world and investors raised bets the Federal Reserve will increase interest rates by the end of the year as the economy recovers.
The U.S. currency gained most versus the South African rand as the MSCI World Index dropped for a second day and Fed funds futures showed an 40 percent chance the central bank will lift uts target rate by September, up from 13 percent a week ago. The yen advanced from a one-month low against the dollar as Japanese bankruptcies fell and merchant confidence improved. The pound slid for a fourth day against the dollar as Prime Minister Gordon Brown confronted a fresh attempt to oust him from office.
Confidence among Japanese merchants rose to a 14-month high in May, the Cabinet Office said in Tokyo. The Economy Watchers index, a survey of barbers, taxi drivers and others who deal with consumers, climbed to 36.7 from 34.2 in April, the highest level since March 2008.
The yen also strengthened for the first time in four days against the dollar as Japanese exporters sold the U.S. currency, said Kengo Suzuki, manager of the foreign bond department in Tokyo at Mizuho Securities Co., a unit of Japan’s second-largest banking group.
The pound extended last week’s losses as Brown, who withstood a rebellion in his ruling Labour Party last week, faces a new attempt today by dissidents to oust him.

EUR/USD in the beginning of session the pair has tried to return back above a level $1,4000, however decreased again later

EUR/USD $1.4000, $1.4035, $1.4050, $1.4090, $1.4100, $1.4120
USD/JPY Y98.50, Y98.40/35, Y98.00, Y97.50, Y99.45
USD/CAD C$1.1075

The Nikkei 225 was higher by 97.62 points, or 1.00%, to stand at 9865.63. The broader-based TOPIX was 10.33 points higher at 926.89. Volume for the Nikkei constituents totalled a preliminary 1.369 bln shares, with 157 issues trading higher, 49 lower and 19 unchanged.

Another slightly scary week where the US dollar lost ground initially but then clawed its way back to where it started. Cable managed a high at $1.6664 before being slapped down by politics, the Euro $1.4339, and best performer the Brazilian real at just 1.9180 per greenback. Eastern European, Baltic states and Scandinavian markets were under a certain amount of pressure, rumours regarding a devaluation of the Latvian currency swirling. FX moves helped many commodities trade higher, most managing to hold on to their gains. Silver led the metals, up at $16.22 per ounce, closely followed by LME Copper (3-month at $5140 per tonne), Palladium (263.50 per ounce) and Platinum ($1293.00). Among foodstuffs Oats, Cocoa and Coffee did best, while Nymex Crude Oil traded up to $69.60 per barrel and Gasoline $1.9850 per gallon. Baltic Dry Freight and Capesize indices soared, to 4093 and 7561 respectively and have now retraced 38% of the calamitous declines of the last twelve months. However, ship owners meeting in Athens this week painted a gloomy picture of massive overcapacity, approximately 35% of current bulk tonnage due in new deliveries within the next three years. Note: most of the ships are being built in China, Japan and South Korea, usually with massive government subsidies. Treasury yields backed up further, benchmark US ten-year hit 3.90% and two-year to a new high for this year at 1.215%. This dragged money market futures prices a little lower. The eagerly awaited US May employment data caused havoc, lower than expected non-farm payrolls of –345K and the slowest loss of jobs since September, offset by soaring claimant count of 9.4% one of the highest since records began in 1948 (10.8% in November 1982). Eurozone Unemployment surged to 9.2%, almost as high as the record 9.4% of 1999, France’s up from 8.0% to 9.1% in just 30 days. Japanese April wages were down 2.5% Y/Y, in negative territory again as they have been for most of the past decade, overtime pay down a whopping –18.8%. Also in negative territory was Taiwan CPI, -0.8% Y/Y and UK Output PPI -0.3% Y/Y, a rare occurrence matching that of June 2002. On a brighter note UK May Nationwide Consumer Confidence at 53 and Services PMI at 51.7 were both above the 50 point which marks the difference between gloom and optimism.

Bank ‘stress tests’ carried out by the US Treasury assumed 8.9% Unemployment in 2009 and 10.3% in 2010, so possibly we are already too close for comfort. The US authorities this week are said to have insisted that JPMorgan Chase and American Express raise equity before repaying TARP funds. UK FSA’s stress tests assume unemployment at 12.0%, no economic growth until 2011, that house prices halve from the 2007 peak, and commercial property drops 60%; they did not publish their results. Carrying out a similar exercise for the Eurozone is possibly too daunting a task for many, and too embarrassing for some.
The euro fell more than 1 percent against the US dollar to a new session low as investors sold the euro on concern that the euro appreciated too fast. Yesterday, the European Central Bank left interest rates steady, and indicated that the euro zone would have negative growth this year, but will recover in 2010. Meanwhile, its labor market would deteriorate further in the coming months.

Spreadbetters Cantor Index are calling the FTSE down 13, the DAX down 2, the CAC down 7 and the Eurostoxx 50 down 1.

- Eco Watchers Survey: Outlook (May) 43.3

- Unemployment Rate s.a. (May) 3.5%

Resistance 3: Y100.70
Resistance 2: Y100.00
Resistance 1: Y99.60
Current price: Y98.50
Support 1: Y98.00
Support 2: Y97.60
Support 3: Y96.70
COMMENTS: Dollar retreats.Resistance comes at May highs on Y99.60/70. Above the resistance is around Apr 10-12 highs on Y100.70. Support at Y98.00 (38.2% Fibo of Y95.60 - Y99.50 rise) still intact. Below losses may widen to Y97.60 (50%), then – to channel support line of Jan 21 at Y96.80.

The Hang Seng Index ended the morning session down 0.74% at 18,541.26.

Resistance 3:Chf1.1050
Resistance 2:Chf1.0970
Resistance 1:Chf1.0895
Current price: Chf 1.0865
Support 1:Chf1.0820
Support 2:Chf1.0750
Support 3:Chf1.0600
СOMMENTS: The pair continues to bargain in the field of former levels. The nearest resistance - Chf1.0895 (session high). Above is probable growth to Chf1,0970 (May 20 low) and further to Chf1.1050 (May 21 high). The nearest support there is level Chf1.0820. Below possible falling to Chf1.0750 (76,4 % FIBO of Chf1,0370-Chf1,1970 growth) and further to Chf1.0600.

The Shanghai Composite Index ended the morning session up 0.40% at 2,764.86.

Resistance 3:$1.6180
Resistance 2:$1.6080
Resistance 1:$1.5980
Current price: $1.5932
Support 1: $1.5860
Support 2: $1.5780
Support 3: $1.5720
COMMENTS: Sterling bargains in a narrow range, heading for a key support at $1.5860 (23.6% Fibo of $1.5120 - $1.6080 rise). Below losses may widen to May 26 low on $1.5780, then – to $1.5720 (38.2%). Session highs present the resistance at $1.5980 with stronger level is $1.6080 (low 04.06.09). Break above will strengthen the bullish momentum and open the way to $1.6180.

Japanese stocks are just drifting from early highs, with the Nikkei last 0.83% higher at 8849.

Resistance 3: $1.4160
Resistance 2: $1.4040
Resistance 1: $1.4000
Current price: $1.3986
Support 1: $1.3840
Support 2: $1.3740
Support 3: $1.3630
COMMENTS: The euro is consolidated. The nearest strong support is located on $1.3840 (area of May 20 high). Below correction of a rate can reach $1.3740 (50% FIBO of $1.3420-$ 1.4050 growth) and to stronger on $1.3630 (channel line of support since Apr 22). The nearest resistance is on $1.4000 (session high). Overcoming of this mark will open road to $1,4050 (22.05.09 high). Above growth is possible to $1.4160 (50,0% FIBO $1,6030-$ 1,2330 falling).

High Low Close
EUR/USD 1.4266 1.3931 1.3971
GBP/USD 1.6242 1.5939 1.5980
USD/JPY 98.88 96.54 98.79
USD/CHF 1.0906 1.0661 1.0853

EUR/JPY 139.20 136.25 137.82
EUR/GBP 0.8864 0.8731 0.8738
GBP/JPY 158.47 154.84 157.64
GBP/CHF 1.7403 1.7116 1.7345

High Low Close
EUR/USD 1.4266 1.3931 1.3971
GBP/USD 1.6242 1.5939 1.5980
USD/JPY 98.88 96.54 98.79
USD/CHF 1.0906 1.0661 1.0853

EUR/JPY 139.20 136.25 137.82
EUR/GBP 0.8864 0.8731 0.8738
GBP/JPY 158.47 154.84 157.64
GBP/CHF 1.7403 1.7116 1.7345

05:00 Japan Eco Watchers Survey: Current (May) 34.2
05:00 Japan Eco Watchers Survey: Outlook (May) 39.7
05:45 Switzerland Unemployment Rate (May 3.5%
05:45 Switzerland Unemployment Rate s.a. (May) 3.4%
08:30 European Monetary Union Sentix Investor Confidence (Jun) -34.3
10:00 Germany Factory Orders s.a. (MoM) (Apr) -0.8% 3.3%
10:00 Germany Factory Orders n.s.a. (YoY) (Apr) -35.8% -26.7%
12:15 Canada Housing Starts s.a (YoY) (May) 118K
23:01 UK BRC Retail Sales Monitor - All (YoY) (May) 4.6%
23:01 UK RICS House Price Balance (May -59.9%