Market Analysis

Bonds started a little better yesterday and then fizzled in the afternoon.  This morning they opened better and have retained the momentum into midday.  The economic calendar is essentially vacant today.  Bonds are improving on a "flight to safety" trade as stocks are selling off slightly today with the Dow currently down 126 points.   Stocks are responding to news that Japan raised its assessment of the accident at Fukushima Daiichi nuclear power station to the most serious level on a seven-step international scale, putting it on a par with the 1986 Chernobyl disaster in the former Soviet Union.   According to the Financial Time though, Japanese authorities are saying the increase in rating does not signal new dangers or setbacks, but rather reflects their first comprehensive estimate of the amount of contamination that has escaped.  Stocks are also responding to a worse than expected earning report from Alcoa, an assessment by Goldman Sachs that profit taking (selling) in commodities was now warranted and a worse than expected March Optimism Index from the National Federation of Independent Business.

This week's economic calendar had no meaningful reports yesterday and today.  Tomorrow the activity picks up though with March Retail Sales on Wednesday, Initial and Continuing Jobless Claims and the March Producer Price Index (PPI) on Thursday and the March Consumer Price Index (CPI), the April Empire State (NY) Mfg Index, March Industrial Production and the April Consumer Sentiment Index on Friday.