Good Morning,

Price strength continued to be manifest in the bullion markets in the hours following the release of the much-awaited US bank stress tests. The trade maintained focus on global equity markets, as has been the case for the past week or more. Gold is bumping up against resistance levels near $926 and could even attempt a breakout towards a test at levels near $960, but is has been doing so on stock market shadowing, rather than a flight to safe-havens. The broad $850/$950 price range remains in place however.

New York spot market dealings opened with a near$8 gain in gold, which was quoted at $917.50 per ounce. Against a background of a slipping dollar (at 83.70 on the index) and another substantial (morning) advance in oil (up $1.25 to very near $58 per barrel), the yellow metal made slow but steady progress. Fund footprints were as obvious as they were in the crude oil and copper pits. The gold ETF however, has not seen a fresh inflow in bars since April 9th. Someone, somewhere, is buying something. The remaining questiononlyhas to do withtheir price targets. Specs always have those in the program, you know.

Naturally, the perma-bulls have already opined that if it is not a global meltdown that will propel gold to its inflation-adjusted price targets, well, then it must be a global melt up , replete with mega-doses of inflation, that will do the trick. A no-lose proposition if ever there was one, in other words. Their words. The melt up part might be correct, anyway. Gold's recent underperformance vis a vis industrial commodities suggests quite strongly that the recession has ended. That is, if crude oil sneaking back beyond $60 per barrel does not kill the root system feeding the ubiquitous 'green shoots' and turn them black.

Silver added 18 cents to once again nudge up against $14 an ounce. Platinum rose $6 and palladium gained $4 to open at $1151 and $242 respectively. Automotive sector news continues on the dismal side, underscoring the speculative nature of the recent rally in the noble metals' complex. Toyota posted a larger-than-anticipated loss and a 22% drop in full-year revenues. GM was still panhandling (for another near $12 billion) in front of Capitol Hill, and Bridgestone had a flat (more like a blow-out) and fell into a loss $350 billion in QI.

Today's primary market focus becomes the jobs data. That non-farm payrolls have shrunk again, is not in question. What is in question, is that this report might well be the last one to show a loss of half million (or higher) monthly job losses, and that the graph appears to have bottomed with January's unmentionable figures.

Although the what-if scenarios in the banking system tests amounted to nothing more than what bank regulators are supposed to do in the course of their normal tasks, the build-up and subsequent talking-head analysis avalanche suggest that this particular set of simulations was and is (still) being construed as a pass/fail exam for the dozen and half banks thatrepresent an aggregate two-thirds of the US' system.

Mr. Geithner is being seen as a man whose visions of recovery in the US banking system entail no Japanese-style 'lost decade

(make that more like a quarter century). He sees US banks earning their way out of this mess. If he miscalculates, the system stands a realistic chance of falling back into the sewer in a couple of years.

As such, the stress test exam verdict is that the system has made it - and far better than it was estimated by doomsayers just a trimester ago. Under the assumption that an adverse set of conditions would persist for another year and a half, the US' 19 largest banks could lose $600 billion more.

As for capital needs, although none of the firmsis be expected to permanently lease a permanent room at 'hotel Geithner' (as TARP has been called), the netnumber being talked about is near $75 billion. Good old BofA makes up about half of that number.The firm's boss, Mr. Lewis, was on the Squawk Box rotisserie this morning, delivering a thesis defense of the tests' findings and slowly turning a nice shade of 'done.' But, we will let his board determine that part.

The payroll data came in at 539,000 - or well below the consensus forecast of 610,000. The figure was the lowest one reported since last October, when 380,000 jobs were shed. Job gains were 72,000 in April. The US unemployment number now stands at 8.9% - a 26-year high. We will see how the Dow treats the job stress test numbers. Thus far, the dollar did not appear to welcome them very warmly. Gold, on the other hand, was losing some of the morning's gains as of this last sentence's birth. Volatility on tap, book-squaring time and all.

Happy Trading.