Following two months of steady pace, the Dow Jones Economic Sentiment Indicator dropped to 44, down from 46.6 in May and April. U.S. news coverage in June was mostly negative, with the focus on U.S. government debt concerns and the new regulation of the financial industry.

"Although debt and regulation concerns were looming, the underlying news about the state of the U.S. economy remained supportive during the month, suggesting the recovery continues at the same subdued but steady pace," says Dow Jones Newswires "Money Talks" columnistAlen Mattich.

The ESI is determined by in-depth sentiment analysis of national news coverage across 15 daily newspapers.It is reported on a scale of 0 to 100; higher numbers represent increasingly positive sentiment.

The index has been weak throughout the first half of 2010, and in June, the ESI's reading was largely influenced by global debt discussions. InEurope, worries about the affect Greek debt default could have on the global financial system garnered negative attention, while growing support of a bailout plan and Athen's passage of an austerity plan were viewed as positive.

Outside of fiscal concerns, positive media coverage in June mentioned falling oil prices.

The Dow Jones Economic Sentiment Indicator aims to predict the health of the U.S. economy by analyzing the coverage of 15 major daily newspapers in the U.S. Using a proprietary algorithm and derived data technology, the ESI examines newspaper articles for positive and negative sentiment about the economy. The indicator is calculated through Dow Jones Insight, a media tracking and analysis tool. The technology used for the ESI also powers Dow Jones Lexicon, a proprietary dictionary that allows traders and analysts to determine sentiment, frequency and other relevant complex patterns within news to develop predictive trading strategies.

The ESI's back-testing to 1990 shows that indicator clearly highlighted the risk that the U.S. economy was sliding into recession in 2001 and 2008 and suggests the indicator can help predict economic turning points as much as seven months in advance of other indicators.