Houston, Texas, June 2, 2008 - Modest gains in bonds and equities kept the investment grade U.S. capital markets growing for a second straight month. The only down point was a trickle of money out of liquidity securities. The investment grade U.S. capital markets grew 0.92% in May to $33.2 trillion.

Up for a second straight month, the $262 billion increase in equities is still overshadowed by April’s gain of nearly $1 trillion. May’s 1.64% gain brought equities up to a value of $16.2 trillion which is 48.87% of the investment grade U.S. capital markets. The strongest growth rate was in the Mining & Construction sector which saw nearly a 5% increase in market capitalization. Though only growing 3.3%, the Manufacturing & Wholesale Trade sector still added over $130 billion and was more than able to offset the nearly $130 billion decrease in the Financial, Insurance, and Real-estate sector.

Down slightly, liquidity securities saw a decrease of $42 billion, or -0.58%, to $7.2 trillion. This puts liquidities at 21.68% of the investment grade U.S. capital markets. Over $100 billion growth in certificates of deposits and Treasury Bills could not offset the movements with short term federal agency bonds and notes. Federal agencies called billions of dollars worth of debt resulting in a decrease of nearly $123 billion in the market for short term federal agency bonds and notes.

Long term investment grade bonds were up 0.84% in May to $9.8 trillion and like liquidity the movement was mostly due to changes in the market for long term federal agency debt. Mirroring almost exactly the movement of short term agency issues, the market for long term agency issues grew by nearly $124 billion, an increase of over 10%. Bonds start June accounting for 29.45% of the investment grade U.S. capital markets. A year ago the $32.7 trillion investment grade U.S. capital markets had equity, liquidity, and bond market proportions of 55.55%, 17.40%, and 27.05% respectively.

Dorchester's flagship index, CPMKTS^sm The Capital Markets Index, is carried on The American Stock Exchange under the symbol CPMKTS, with updates every 15 seconds. The Amex also publishes the component indexes: CPMKTSE^sm The Capital Markets Equity Index, CPMKTSB^sm The Capital Markets Bond Index and CPMKTSL^sm The Capital Markets Liquidity Index.

About Dorchester Capital Management LLC.
Dorchester Capital Management LLC is a Houston-based company principally focused on designing financial products for the professional investment community. Dorchester’s unique approach to processing, organizing and standardizing capital markets data from the broadest variety of sources gives it a superior ability to help clients with the fundamental risk analysis questions of asset allocation and benchmarking. For additional information, please visit the company's Web site at www.cpmkts.com.

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