American equity markets started the quarter as they finished it; soaring higher. The Dow finished ahead by 1.4% on the day while the broader indexes posted similar gains as the S&P 500 also moved higher by 1.4% and the Nasdaq rose by 1.5%. Commodities, however, did experience some weakness as gold sank below the $1,500-per-ounce level to finish the week below $1,490, while oil fell by about $0.60 on the day as well. Other commodities were more mixed, as livestock and industrial metals rose while softs faced another day of choppy trading; soybeans rose by 3% and corn continued its slide, tumbling by close to 3.8% to finish the week.

In currencies, the dollar struggled against most of the world's majors, while traders continued to seek risky assets, leading to another loss for T-Bills. This corner of the market saw yields on the Ten Year hit the 3.2% mark while the Two Year rose to 0.50%, representing a nearly 20-basis-point surge for the short-term government bond in a matter of days.

One of the biggest winners in the ETFdb 60 was the iShares Dow Jones Transportation Average Index Fund (NYSE: IYT), which added 2.3% on the day. These gains came largely thanks to some solid data along with moderate oil prices in Friday trading. Although analysts had expected the ISM Manufacturing Index to decline to 52 from its previous level of 53.5, it actually rose up to the 55.3 level, suggesting that the national manufacturing conditions are improving. Although a good chunk of the gains were due to increases in inventory, many focused in on the employment section of the report, which rose to 59.9, a nearly 2-point gain in month-over-month terms. As a result, many assumed that the economy would be picking up again, so the move by some traders was to buy up highly cyclical stocks such as IYT in preparation.

Transports are often one of the first sectors to lead the market out of the doldrums, so it is encouraging that IYT has added close to 5.6% in the past two weeks, possibly signaling a solid start to the third quarter for the beaten-down economy (More on IYT fundamentals.)

One of the biggest losers on the day was the iPath S&P 500 VIX Short-Term Futures ETN (NYSE: VXX), which lost 4% to start the third quarter. These continued losses for VXX came as all of the major indexes capped one of their best weeks in recent memory, with the major benchmarks gaining at least 5% in the past five days. This bullish tone was led by a short-term resolution to the Greek crisis after the country passed further austerity measures and a series of bullish points regarding U.S. data.

Thanks to this run, investors also abandoned the U.S. dollar, Treasury bills, and gold, highlighting the lack of demand for safe havens such as VXX on the week. In fact, VXX is now down 13.8% over the past five day period and has lost 17.9% in the past two weeks alone. This suggests that although volume has been high in this fund that represents the "fear index," many traders have begun to bet on higher stock prices and lower demand for safe havens such as this popular iPath product. (See more on VVX.)

Disclosure: No positions at time of writing.

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