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Andrew,

KEY EVENTS TO WATCH FOR:

10:00 AM ET. Weekly grain export inspection reports.

10:00 AM ET. May Challenger monthly layoff report.

10:00 AM ET. May NAPM non-manufacturing index.

1:30 PM ET. Treasury releases results of $23 billion auction of 13-
and 26- week bills (Previous accepted rates: 13-week 3.605%, 26-week
3.550%)

3:00 PM ET. USDA planting progress reports.

3:00 PM ET. USDA crop conditions reports.

KEY HEADLINES:

Oil prices spikes as Iraq stops exporting in protest at UN sanctions.

Bristol-Myers, Novartis are leading bidders for DuPont unit, says
report.

IMC: Greenspan sees little evidence of emergence of US inflation.

Barclays reports good first quarter growth from consumer leading and
savings.

Vivendi may sell BskyB stake to institutions, says report.

Duisenberg, Greenspan advocates price stability for growth.

Bank of Japan says further deflation "can't be ruled out."

Microsoft, AOL talks on Windows XP deal faltering, says report.

The STOCK INDEXES & MARKETS

The NASDAQ and S&P 500 were higher overnight due to follow-through
buying after closing higher last Friday. As long as both indexes hold
above their May lows, it appears as though minor low might be
forming. Strengthening technology stocks despite a
weaker-than-expected NAPM report on Friday continues to support
short-term gains. The Dow posted a key reversal up last Friday due to
light short covering. Additional gains on Monday are needed to
confirm this bullish reversal pattern. However, momentum indicators
are bearish warning traders and investors alike to use caution, as
the Dow remains vulnerable to additional weakness near-term. If the
decline off May's high continues, May's reaction low crossing at
10,774.10 is the Dow's next target.

European markets were mostly higher in overnight trading in response
to strength in U.S. equity markets, which were higher overnight. The
UK FTSE- 100 was up 34.20 points at 5843.80 while the German DAX-30
was 41.05 points at 6166.22 as of 11:01 BST.

The Nikkei was higher overnight after fluctuating in less than a
100-point range all day. High technology and banking stocks remain
weak due to earnings concerns while selected defensive stocks such as
real estate, oil and coal issues were pushed higher. The Nikkei
continues to consolidate below the 38% retracement level of this
spring's rally that crosses at 13,363. If the decline off May's high
continues, the 50% retracement level crossing at 12,995 is a
potential target later this year. Momentum indicators remain bearish
signaling that additional weakness near-term is possible. The Nikkei
closed up 50 points to 13,312.

INTEREST RATES

September bonds were slightly higher overnight as it extended last
week's rally. Last Friday's rally led to a breakout above this
spring's downtrend line, which confirmed that a short-term bottom has
been posted. I would not be surprised to see a setback on Monday as
September might try and test broken trendline line resistance
crossing near 100-00 before moving higher during June. Momentum
indicators have turned bullish signaling that sideways to higher
prices into early-June are possible.

The German bond market or Bunds started the new week lower. Germany's
contribution to the market is expected to be limited, as many traders
are taking the day off for a public holiday. The June Bunds were last
up 0.07 at 106.63.

Japanese government bond markets were nearly steady overnight as the
market was locked in range bound trading. The lead June 10-year JGB
futures closed at 140.53 yen, up 0.01 while the yield on the
benchmark No. 231 June 10-year cash bond stood at 1.240%, down 0.005
as of 1520 JT.

The ENERGY MARKETS were higher in overnight trading in response to
news that Iraq has halted oil exports in protest U.S. and U.K.
efforts to impose a "smart" sanctions policy. Iraq's oil minister
indicated that oil exports would only resume if the UN renewed the
oil-for-food deal for the regular six-month interval.

July crude oil gapped up on the oil embargo news from Iraq and
extended gains overnight as it consolidates above the 38% retracement
level of this year's rally crossing at 28.26. Closes below last
week's low at 27.55 would open the door for a larger-degree decline
ahead of this week's OPEC meeting. Momentum indicators are bearish
but nearing their respective oversold zones warning traders to use
caution as a short-term bottom might be near.

July heating oil was higher overnight but off session highs following
a gap higher opening. Like crude oil, heating oil rallied on news of
Iraq's halt of oil exports. However, July remains below this spring's
uptrend line crossing near 77.60, which strongly suggests that a top
and trend change has taken place. Unless July heating oil can close
above broken trendline support, May's reaction low crossing at 74.55
is July's next downside target.

July unleaded gas was higher overnight but near session lows as the
short covering bounce began to fade in late-session trading.
Nevertheless, a higher close during the day session would strongly
suggest that last Thursday's spike below May's reaction low crossing
at 91.20 marked a double bottom. Momentum indicators remain bearish
signaling that sideways to lower prices near-term are still possible.

July Henry Hub natural gas was higher overnight as it continues to
consolidate above last October's low crossing at 3.86. Multiple
closes above last week's high crossing at 4.075 would increase the
odds that a short-term bottom has been posted. Short-term momentum
indicators have become oversold warning bears not to press their hand
as downside risk appears limited for the time being.

CURRENCIES

The September Euro was higher overnight as a combination of euro-
supportive and yen-negative comments from various central bankers
appears to have given the currency a modest bounce. It will take
closes above last week's high crossing at 85.70 to temper the
near-term bearish outlook in the market. If the decline continues, a
test of last October's lows crossing at 83.77 is possible later this
month. The daily ADX (a trend-following indicator) is still bearish
signaling that sideways to lower prices are possible into early-June
are possible.

The September British Pound opened higher due to light short covering
overnight hinting that last Friday's low might have completed the
setback from last Wednesday's high. Momentum indicators are neutral
to bullish, which suggests that sideways to higher prices into
early-June are possible. If the rebound off May's low resumes,
trendline resistance crossing near 1.4290 is September's next target.

The September Swiss Franc opened higher overnight and is challenging
last week's gap, which led to a breakout into new contract lows. It
would take closes above last Wednesday's high of .5644 to temper the
bearish outlook in the market. Until then, the door is open for a
test of weekly support crossing at .5488 later this month following
last week's breakout below last October's low crossing at .5643. The
ADX (a trend-following indicator) is bearish signaling that
additional weakness during June is possible.

The September Canadian Dollar was higher overnight and remains poised
for a test of May's high crossing at .6541 later this week. Closes
above .6541 are needed to confirm an upside breakout of May's trading
range thereby renewing this spring's rally. Momentum indicators have
turned bullish signaling that sideways to higher prices during the
first half of June are possible.

The September Japanese Yen was lower overnight due to light profit
taking. Nevertheless, last week's breakout above trading range
resistance has opened the door for additional gains this spring. If
the yen's rally continues, minor resistance crossing at .8702 is the
next target later this month. The daily ADX (a trend-following
indicator) has entered a bullish trend mode signaling that additional
strength is possible.

PRECIOUS METALS

August comex gold is working on a possible inside day but was lower
overnight as it remains poised to extend its decline off May's high
following last Thursday's breakout below April's uptrend line
crossing near 267.50. If August gold resumes its decline, a test of
this spring's low crossing at 257.30 is a potential target later this
year. Stochastics and RSI are bearish signaling that additional
weakness into June is likely.

July silver was slightly lower overnight as it is working on a
possible inside day. A lower close during the day session would
signal an end to last Friday's short covering bounce. Momentum
indicators have turned bearish signaling that additional weakness
near-term is possible. If the decline off May's high continues, a
test of the lower boundary of this spring's trading range crossing at
4.31 is July's next target later this month.

July copper was slightly higher overnight due to light short covering
as it has become slightly oversold on a short-term basis following
last week's decline. However, the door remains open for a test of
May's low crossing at 74.75 later this month. Momentum indicators are
bearish signaling that sideways to lower prices into early-June
appears likely. Closes below May's low could lead to a test of weekly
support crossing at 74.10 later this spring.

GRAINS

July corn was lower overnight as traders await this morning's export
inspection report and this afternoon's planting progress and crop
conditions reports. Cool/wet weather across the western Corn Belt has
slowed early crop development and has forced some replanting as some
areas have experienced excessive moisture, which has drowned out some
of the crop. For the most part traders do not seem too concerned over
planting delays in the western Corn Belt but do have their eye on a
potential drought, which might be developing in China. Last Friday's
gap and close above May's downtrend line crossing at 1.93 1/4
strongly suggests that a short-term low has likely been posted. If
July extends last week's short covering rally, a test of May's high
crossing at 2.11 1/2 is the next upside target. Early calls are for
July corn to open 2 to 2 1/4 cents lower this morning.

July wheat was lower in overnight trading due light profit taking
following last Friday's test of May's uptrend line. Losses were
limited due to disease concerns in Kansas and last week's strong
export sales report. Multiple closes above May's downtrend line,
which crosses near 2.72, would signal that a short-term bottom has
been posted. While supply side fundamentals remain bullish, export
demand needs to show significant improvement in order for July wheat
to sustain a late-spring rally. One of the most important things that
could happen to help sluggish wheat exports would be to see the U.S.
Dollar fall from current levels. Early calls are for July wheat to
open 1 to 1 1/4 cents lower this morning.

SOYBEAN COMPEX

July soybeans were lower in overnight trading due to light profit
taking as the market consolidates some of last week's gains. Last
week's breakout above this spring's trading range along with closes
above recent highs crossing at 4.53 1/2 have opening the door for a
possible test of March's high crossing at 4.77 3/4 later this month.
Cool/wet weather across the Midwest Soybean Belt has raised concerns
over emergence and planting delays. Traders will be closely watching
today's export inspection, planting progress and crop conditions
reports for near-term direction in the market. Early calls are for
July soybeans to open 1 to 1 1/4 cents lower this morning.

July soybean meal was steady overnight despite last Friday's downside
reversal. Stronger than expected export demand last week along with a
tight domestic cash market continues to underpin the meal market.
July meal is at an important crossroads and will need to close above
168 or below 159.60 to clear up near-term direction in the market.
Short-term momentum indicators are still bearish warning bulls that
closes into new highs for this spring are needed to renew the rally
off March's low. Early calls are for July soybean meal to open steady
this morning.

LIVESTOCK

August hogs closed sharply higher for the fourth day in a row filling
April's gap crossing at 64.90. The stage is set for additional gains
and a likely test of April's high crossing at 65.95 later this month.
This week's rally underpinned by fund buying is due in part to
futures discount to the cash market and ideas that loin prices should
bottom next week. Momentum indicators are bullish signaling that
sideways to higher prices into early-June are possible.

August cattle closed out the week on a high note as the stage is set
for a test of January's high crossing at 75.00 next week. The
discount of futures to the cash market along with higher cash bids
this week continues to underpin August's rally. Momentum indicators
are bullish but have become overbought warning traders to use caution
as a top may be near.

FOOD & FIBER

July coffee closed higher on Friday due to light short covering ahead
of the weekend. However, a sell off ahead of the close tempered much
of today's early gains leaving the door open for sideways to lower
prices next week. This week's breakout into new contract lows has
opened the door for a test of long-term support crossing at 51.70
later this month.

July cocoa closed higher on Friday due to light short covering
following Thursday's breakout below trading range support crossing at
955. Momentum indicators remain bearish despite their oversold
condition hinting that additional weakness into early-June is
possible. If the decline continues, the 75% retracement level at 862
is July's next target.

July sugar closed higher on Friday due to light short covering as it
consolidates around the 38% retracement level of this spring's rally
crossing at 857. Momentum indicators remain bearish signaling that
sideways to lower prices next week is still possible. If the decline
continues, fib support crossing at 832 then 808 are targets.

July cotton extended this week's short covering rally as it
consolidates above psychological support crossing at 40-cents. Light
support came from today's export sales report that came in at 107,300
bales. Additional support came from news of some 300,000 to 350,000
acres of west Texas cotton being destroyed by flooding. However,
upside potential remains limited due to this year's burdensome
carryout levels, which are expected to grow in the coming year.
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