Morning Briefing – US markets stable this morning on Globex

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On November 5, 2018, Posted by , In Morning Briefing,Nos articles, With No Comments

US grain markets

The markets closed higher on Friday, supported by rumors concerning possible solutions to the current US/China trade war. They remain rather stable this morning on Globex with operators awaiting the result of the mid-term elections on Tuesday and the WASDE report on Thursday.

Corn

The December contract closed 4c up at 371c. It trades this morning around its closing levels.

The USDA rose its acreage estimates for 2019 to 92m acres. For Thursday’s WASDE report, the operators expect a lower 2018 production estimate.

Mexico bought 200.9kT of US corn.

Brazil exported 3.2mT in October, 200kT less than in September and 36.3% less than one year ago.

In France, harvest is almost complete (96%). 57% of the grains are in good to excellent condition, down from last year’s 81%.

Soybeans

The January contract closed 6c up at 888c. It trades this morning 1c lower.

The USDA lowered its acreage estimates for 2019 by 7% to 82.5m acres. The agency expects crush to rise by 10%.

For Thursday’s WASDE report, the operators expect a slightly lower 2018 production estimate.

Wheat

The December contract closed basically unchanged (+0.6c) at 509c. It trades this morning 1c higher.

The USDA rose its 2019 wheat acreage estimates to 51m acres.

In France, 69% of the winter wheat is currently planted, 8% less than last year at date.

Other markets

The main US stock indexes closed lower on Friday. The S&P lost 0.6%. The US government made contradictory statement as regards the US/China trade war. Higher than expected new jobs creations also weighed on share prices.

The US economy created 250k new jobs in October where economists expected 202k. The unemployment rate remained steady at 3.7%. Wages rose 3.1% over a year.

Crude oil prices dropped further. The US announced that a series of 8 countries may continue to buy Iranian oil in despite of the sanctions. This, combined with a rising US and Opec production, may lead to a short term oversupply, weighing on prices. The December WTI trades this morning around $62.80 and the December Brent around $72.50.

The Dollar remains supported after Friday’s US employment report. More than expected new jobs and rising wages should allow the FED to proceed with its interest rate increase program. The €/$ pair trades this morning around 1.1340.

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