Dow Industrials Endure Worst June since 1930

The Dow Jones Industrial Average (DJIA) fell 10.2 percent, marking its worst June performance since the Depression

Following the market's dismal performance during the past couple of weeks, today's session seemed like a breath of fresh air. The gains were relatively mild, but it was nonetheless a welcome relief to see our major market indices dallying in positive territory for a good portion of the day. Of course, let's not call this a comeback rally just yet – many analysts believe that today's modest upside was simply the result of end-of-quarter buying by fund managers. And, despite a (barely) positive daily finish from the Dow industrials, it's hard to avoid the fact that the blue-chip barometer endured its worst June since 1930.

Of course, the situation is not nearly as dire today as it was during the Great Depression. For the sake of perspective, the Dow Jones Industrial Average (DJIA – 11,350.01) shed nearly 18% in June 1930, compared to a loss of 10.2% in June 2008. The Dow today tapped an early nadir of 11,287.56, its lowest level since August 2006, before rebounding into positive territory. An eleventh-hour sell-off eliminated most of the Dow's gains, though, leaving the blue chips with a modest 3.5-point advance for the session. Exactly half of the Dow industrials closed in positive territory, led by Chevron (CVX) and Exxon Mobil (XOM), while IBM (IBM) paced the decliners.

In fact, the tech sector was heavy-hit in today's session. While the S&P 500 Index (SPX – 1,280.0) eked out a modest gain of 1.62 points, the Nasdaq Composite (COMP – 2,293.0) fell nearly 23 points, or about 1%. For the month, the SPX lost 8.6%, while the COMP fell 9.1%.

Turning to equities in focus, bond insurer MBIA Inc. (MBI) fell to a 21-year low after the company said it sold some investments to raise capital ... The shares of Mesa Air Group (MESA) advanced after the company reported second-quarter earnings ... E*Trade Financial (ETFC) lowered its debt by $95.8 million in the second quarter ... HSBC Holdings (HBC) experienced heavy option activity after Moody's cut its financial strength rating from "B-" to "C+" ... Retail concern American Eagle Outfitters (AEO) was upped from "underperform" to "market perform" by Friedman, Billings & Ramsey ... and today's Quote of the Day comes from an anonymous J.P. Morgan Chase (JPM) executive. In this Vanity Fair article, the source explains the high anxiety among J.P. Morgan's top brass as they deliberated over the acquisition of a quickly collapsing Bear Stearns:

"We all kind of slept on it, or not slept on it, kind of closed our eyes for a half-hour, and realized that if you take a step back and remove yourself from the enormity of it, what we were being asked to take over, from a risk factor, was gargantuan."

Tensions between Iran and Israel today helped contribute to another new record high for crude-oil prices. Iran warned that any attacks by Israel would be met with retaliation, and promised a negative impact on shipping through the Persian Gulf, particularly the Strait of Hormuz. Meanwhile, rebel violence continued to affect production out of Nigeria. By the close of trading, though, strength in the dollar pushed crude futures to a mild loss for the session. The August-dated contract shed 21 cents to settle at $140 per barrel. Crude oil is up 46% year-to-date, and 37.8% for the second quarter. Tomorrow, the International Energy Agency is expected to report that its global demand estimate has been downwardly revised by 1.4 million barrels per day, due to weak economic growth and skyrocketing oil prices.

After gaining more than 3% last week, gold futures dropped today. The safe-haven investment was punished as the U.S. dollar turned higher against the euro. The European Union's currency took a hit after euro-zone inflation rose 4% in June, surpassing analysts' expectations for a 3.9% increase. Gold for August delivery fell as low as $920.50 an ounce before paring some of its losses. By the close, August-dated gold was down $6.30 to finish at $925 an ounce. On Thursday, the European Central Bank will release its latest interest-rate decision, while U.S. investors will hear the most recent nonfarm payrolls report – which should set up an interesting day's worth of currency trading.

Levels to Watch in Trading:

Dow Jones Industrial Average (DJIA – 11,350.01) - support at 11,300; resistance at 12,200
S&P 500 Index (SPX – 1,280.0) - support at 1,200; resistance at 1,400
Nasdaq Composite (COMP – 2,293.0) - support at 2,273; resistance at 2,550