DTN Early Word Grains
No Nukes is Good Nukes
May corn was fractionally lower, May soybeans were 1 cent higher, and July Kansas City (SRW) wheat was 1 cent lower.
CME Globex Recap:Heading into the recently passed three-day holiday weekend, global markets were on edge about a possible confrontation between the United States and North Korea. However, as the extended weekend played out, no military action was seen. Gold continued to gain ground regardless, posting a strong initial rally overnight before contracting slightly. Most other commodities were under pressure, except for soybeans and Chicago wheat.
OUTSIDE MARKETS:The Dow Jones Industrial Average closed 138.61 points (0.7%) lower at 20,453.25. The NASDAQ Composite fell 31.01 points (0.5%) to 5,805.15 and the S&P 500 lost 15.98 points (0.7%) to 2,328.95 Thursday. DJIA futures were 13 points lower early Monday morning. Asian markets closed mixed with Japan's Nikkei up 19.63 points (0.1%), Hong Kong's Hang Seng off 51.84 points (0.2%), and China's Shanghai Composite down 23.90 points (0.7%). European markets were trading mostly lower Monday with London's FTSE 100 off 21.40 points (0.3%), Germany's DAX losing 45.70 points (0.4%), and France's CAC 40 off 30.01 points (0.6%). The euro was 0.0014 higher at 1.0627 while the U.S. dollar index was down 0.19 at 100.32. June 30-year T-Bonds were 11/32 higher at 154'11 while June gold gained $3.60 to $1,292.10. Crude oil was $0.42 lower at $52.76 while Brent crude dipped $0.44 to $55.45. China's Dalian soybean and Malaysian palm oil futures were both lower overnight.
P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
| BULL | BEAR | ||
| 1) | Weekly export inspections could be bullish for corn again Monday morning. | 1) | Corn's short-term uptrends look to be nearing their end. |
| 2) | Similar to corn, total marketing year inspections for soybeans are expected to be bullish again this week. | 2) | Traders will continue to monitor Brazil's soybean crop that seems to continue getting bigger. |
| 3) | Winter wheat's crop condition estimates could be slightly bullish when released Monday afternoon. | 3) | Monday morning's weekly export inspection numbers could come in slightly bearish for wheat. |
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MORE COMMODITY-SPECIFIC COMMENTSCORN While the May corn contract continues to be used in the calculation of cash price, July became the most active contract according to open interest. Looking at July corn, the minor (short-term) uptrend on its daily chart looks to running out of gas as the contract tested resistance between $3.77 3/4 and $3.81 1/2 last Thursday and again overnight. While another push seems likely, increased commercial selling could be seen in the near future. Fundamentally traders will take note of weekly export inspections (morning) and crop progress (afternoon) numbers Monday. Light early support from soybean could continue to be seen.
SOYBEANS As with corn, July soybeans became the most active contract based on open interest just as the markets (both old-crop and new-crop) posted bullish technical signals on weekly charts at the end of last week (for more information, see DTN's Technically Speaking blog to be updated later Monday). Demand remains strong for old-crop, with traders looking for another solid weekly export inspection number Monday morning's report. This same group, global traders, will also weigh in on weekend weather developments in South America. Technically, old-crop July's initial resistance is pegged near $9.97 3/4 while new-crop November's is sitting up at $9.81. As for new-crop, traders will also keep an eye on domestic weather forecasts and Monday afternoon's weekly crop progress estimates.
WHEAT Winter wheat contracts were mixed Monday morning with Chicago posting fractional gains while Kansas City was down about a penny. Weekend weather over the Southern Plains (HRW) growing area saw a number of severe storms develop, with the bottom line being much of the new-crop saw rain. Some traders might take a look at Monday afternoon's weekly crop condition estimates, though it remains too early to form much of a conclusion about crop size. As for old-crop, weekly export inspections are expected to be solid once again, possibly providing light support to the nearby Chicago May contract.
| DTN Cash | Change From | National | Contract | Change from | |
| Commodity | Index | Prev Day | Avg. Basis | Month | Prev Day |
| Corn: | $3.35 | $0.02 | -$0.36 | May | $0.002 |
| Soybeans: | $8.82 | $0.08 | -$0.74 | May | $0.005 |
| SRW Wheat: | $3.89 | -$0.03 | -$0.41 | May | $0.000 |
| HRW Wheat: | $3.37 | -$0.03 | -$0.90 | May | $0.002 |
| HRS Wheat: | $4.90 | $0.02 | -$0.40 | May | $0.003 |
Darin Newsom can be reached at darin.newsom@dtn.com
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