Traders going on vacation are one of the reasons cited by the press why today was a rather dull and directionless trading day.

A government inflation report - the so-called core-PCE deflator - was released early in the day. This report is in fact an important inflation gauge for the Fed, who announced yesterday that it would continue to scrutinize economic data piece by piece to evaluate whether it should keep raising interest rates. Today’s core-PCE deflator data covers the inflation activity for May and had no market-moving impact. Additional economic data was released - the revision to the University of Michigan Consumer Sentiment Survey and the Chicago Purchasing Manager's Index – but these are considered “lower-tier” economic releases and also did not budge the range-bound market today.

Just in time for the Independence Day holiday, crude oil prices shot above $74 a barrel during the trading session (and then closed just below $74). This upward pressure comes in reaction to an anticipated strong increase in the use of gasoline. According to projections made by the AAA, holiday traffic during the July 4 holiday will lead to more than 40 million people traveling 50 miles or more from home. This data is up 1.2% from the prior year.

A report released today by The Commerce Department shows that higher gasoline prices having an impact on consumer spending. Consumers curtailed their spending sharply in May, a fact that was attributed to high gasoline prices.

© HGH Associated Press

News Archive (from 4/1/2006 until 6/30/2006)