DTN Morning Comments on Livestock; Live & Feeder Cattle, and Lean Hogs

Cattle Futures to Open Cautiously Mixed as Trader Wait for Cash News

Live and feeder contracts seem set to open slowly mixed with traders split over cash prospects and the technical significance of yesterday’s sell-off. Lean hogs are likely to begin moderately higher thanks to bull spreading interest and stronger carcass value.
By John Harrington DTN Livestock Analyst
Cattle: Steady-$1 HR Futures: mixed Live Equiv $130.72 + 0.06* Hogs: Steady-0.50 HR Futures: 10-30 HR Lean Equiv $110.66 + $1.39** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Mixed Early Friday

Corn futures are lower at 6 a.m. CDT; soybeans higher; wheat higher.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn 1/4 cent lower, soybeans 5 cents higher (November), and wheat 2 cents higher.
CME Globex Recap: Grains were quiet again overnight with traders seemingly waiting on something to happen in the weather. Corn posted another three cent trading range while wheat moved six cents and soybeans eight cents. Outside commodities were mostly lower with gold posting a sharp $24 loss.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Midday Comments on Livestock

Lean Hog Paper Likely Open Higher

Look for lean hog futures to open moderately higher this morning, supported by midweek short covering and improving carcass value. On the other hand, the cattle pits will probably start trading on a mixed basis thanks to cautious positioning ahead of more definitive cash and product news.
By John Harrington DTN Livestock Analyst
Cattle: Steady-$1 HR Futures: mixed Live Equiv $130.92 – 0.10* Hogs: Steady-0.50 HR Futures: 10-30 HR Lean Equiv $109.35 +$1.24** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

 

DTN Midday Comments on Grains

Soybeans Lead Grains Higher at Midday

Grain trade is positive across the board at midday is slow trade.
By David Fiala DTN Contributing Analyst
General Comments
The U.S. stock market is flat to higher with the Dow futures up 70. The interest rate products are higher. The dollar index is 10 higher. Energies are higher with crude up $1.25. Livestock trade is mixed. Precious metals are lower with gold down $19.
CORN
Corn trade is fractionally to 3 higher in quiet midday trade. Outside markets are generally pretty neutral. Upside December resistance is now the $4.84 10-day, then the $4.98 20-day moving average. The weather forecast looks to bring better moisture to many areas in the near term, but continued below-normal temperatures are raising concerns. These concerns are limiting sellers at new lows. Ethanol production was off slightly on the week, but stocks dipped 800,000 barrels after consecutive draws, so overall fairly neutral as far as corn goes. The basis has started to show some signs of recovery.
SOYBEANS
Soybean trade is 13 higher on the August, and 2 to 5 higher on most other contracts at midday, meal is mixed and bean oil is up 10 to 20 points. Chart momentum has turned down, but is showing signs of stabilizing November soybean support is at $12.00 and resistance is at the $12.42 10-day moving average. Trade breached 12.00 overnight but has recovered so far. The USDA confirmed 120,000 metric tons of soybean sales to an unknown destination. Weather remains mostly non-threatening for beans in the near term as well. Old-crop basis has started to stabilize after the big break, and will be watched closely. The August contract goes into delivery today, which will tell us quite a bit about the amount of beans remaining if significant deliveries occur.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update From Mike Kuta " The Squawk Trader " Part 2

July 31, 2013
U.S. funds’ equity allocation at six-year low.
U.S. money management firms trimmed share holdings in July to their lowest in more than six years, taking profits after a strong first-half rally, and also shifted out of bonds into cash and alternative assets. Since the start of the year, the average equity allocation in a model global portfolio has fallen 8.5 percentage points to 56.2 percent, the lowest since at least April 2007, a monthly Reuters survey showed. In June, equity took 57.9 percent share. Average bond holdings also fell this month, to 35.4 percent from 36.3 percent in June, while the average cash holding rose to 3.6 percent from 2.1 percent. U.S. bond yields have risen substantially this year partly as a result of the improving economy, and with most analysts convinced that the Federal Reserve will soon start to scale back its $85 billion of monthly bond purchases. Government bond holdings were cut to 45.8 percent from 50.2 percent in June. Firms recommended a bigger share of bond portfolios be in high-yield debt and other credit such as agency debt. This category rose to 13 percent from under 10 last month. The poll of 12 U.S.-based fund firms was conducted between July 17 and 30. Some pegged the latest decline in model stock holdings to shareholders cashing in on an extended rally in both U.S. and Japanese equities. The U.S. benchmark Standard and Poor’s 500 index is up a little over 18 percent so far this year, while the Nikkei 225 index is up more than 30 percent. “The market has moved substantially, and it’s giving investors an opportunity to book some profits, especially at a time when it appears that there is a slowing in overall corporate profits,” said Alan Gayle, director of asset allocation at RidgeWorth Investments, who manages $325 million in four portfolios. Companies in the S&P 500 are expected to post a blended earnings per share growth rate of 4.0 percent in the second quarter, according to Reuters data, down from 4.9 percent in the first quarter.
What Does the Plastics Revolution Mean for Gas Producers?
It looks like the U.S. plastics revolution is upon us. Many observers have been forecasting a petro-chemical boom in America. Driven by cheap natural gas as feedstock for the industry. Last week, two major players in the chemicals space threw their weight behind the idea. Sasol and Ineos announced they will build a 426,000 mt/year plant–likely on the Gulf Coast–to manufacture high-density polyethylene. A major input in plastics-making. The announcement adds more fuel to the fire beneath the burgeoning U.S. chemicals sector. Sasol has previously announced plans for two other Gulf Coast facilities to make low-density polyethylene. All of this added polyethylene capacity could have some interesting effects for natural gas producers. That’s because America is right now experiencing a major glut of ethane–a natural gas liquid that E&P companies sell to end-users like Sasol, as an input for making polyethylene. Because of increased drilling for natural gas liquids lately, there’s been a lot of ethane on the market. To the point where ethane prices have fallen to almost nothing. Developments like the one above thus make a lot of economic sense, able to cheaply source their inputs. But the increased demand could help to bring prices back up to some degree. Which would be great news for producers who’ve seen their profits shrink as ethane has fallen. A number of polyethylene facilities are now planned or being built. As the first ones get completed, we’ll see what effect the plastics revolution has for gas producers.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Cotton

Cotton Trades Cautiously Down Few Ticks

Traders await results of Federal Reserve policy review and a variety of other reports. Cash grower and business trading both were inactive on The Seam.
By Duane Howell DTN Cotton Correspondent

Cotton futures moved cautiously a bit lower early Wednesday on this last day of the month ahead of results later in the day of a Federal Reserve policy review and a passel of other reports this week.
Benchmark December hovered off four ticks at 85.10 cents at 6:52 a.m. CDT, trading within only a 48-point range from 85.02 and 85.50 cents on a thin contract volume of 790 lots. March traded off 12 points to 83.42 cents.
The policy statement by the Fed, which began a two-day meeting Tuesday, will be followed by an announcement of the outcome of their respective policy reviews on Thursday by the European Central Bank and the Bank of England.
A report on U.S. second quarter gross domestic product growth also was scheduled for release today, and U.S. employment data for July will be issued on Friday.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update from Mike Kuta " The Squawk Trader"

July 31, 2013
Germany Boosts Energy Research Funding to $938 Million.
Germany increased spending on energy research 77 percent in the past seven years, benefiting mainly efficiency and renewable energy research projects as the country shuts its nuclear reactors. Germany’s government spent 708 million euros ($938 million) on research and development of energy technologies last year, up from 399 million euros in 2006, the Economy Ministry said today in an e-mailed statement, citing its new study. Projects included reducing noise of wind-power units, making buildings more energy-efficient and advancing electro-chemical storage units, the study shows. “Research and development of modern energy technologies are an important condition for the success of the energy switch,” Economy Minister Philipp Roesler said in the statement. Energy efficiency and renewable projects accounted for about 500 million euros of the funding last year, the ministry said. German Chancellor Angela Merkel is attempting to lead the biggest transition to renewables of any developed country in history, seeking to more than triple the share of renewable power by 2050 to 80 percent of the nation’s consumption. The renewables are to help replace nuclear reactors to be shuttered by 2022.
Investors on edge as central bank decisions, data loom.
Caution before potentially game-changing central bank policy decisions and data undermined stock and oil prices today, overshadowing figures that offered hope Europe’s economy might pick up soon. A U.S. Federal Reserve statement today will be scoured for clues on when it will curb its bond-buying stimulus program that has supported global markets. On Thursday, attention will switch to European Central Bank and Bank of England policy meetings and data on global manufacturing activity, followed by the always keenly awaited U.S. employment report on Friday. Signs the developed world’s central banks will keep monetary policy loose for a long time to support a tentative economic recovery have put many equity and commodities markets on course for their best month of the year in July.
But strategists say the gains, which could see the MSCI World Equity index post its best monthly rise since February 2012, have increased the risk that investors could find reasons over the next few days to cash out. “At the least what we expect is a lot more volatility and we think the volatility comes with a bit more downside risk than upside potential,” said Wouter Sturkenboom, investment strategist at Russell Investments. Any hints of imminent “tapering” of Fed bond buying could hit stocks and gold but push the dollar higher, but few expect a clear-cut signal. Before the Fed decision the focus will be on U.S. second quarter growth figures at 1230 GMT and a private sector employment report, that could give hints on the strength of the economic recovery.
In Europe, modest stock market gains were underpinned by data showing the number of people out of a job in the euro zone fell for the first time in more than two years in June. Europe’s broad FTSEurofirst 300 index, set to make July its best month in over a year, rose 0.1 percent today. Caution before the Fed statement left the dollar trading flat against a basket of major currencies, though not far from a five-week low of hit on Monday. The dollar has lost ground in recent weeks as the Fed sought to reassure markets that interest rates would stay low. “If there’s any suggestion the Fed is going to taper the current bond buying program as soon as September, then that’s U.S. dollar positive,” said Ben Le Brun, an analyst at OptionsXpress.
CHINA FEARS:
Earlier in Asian trading, MSCI’s Asia-Pacific ex-Japan share index <.miapj0000pus> slipped 0.6 percent taking its losses so far this year to 5 percent as the region’s markets suffer from fears that China’s giant economy is slowing rapidly. A reading on manufacturing activity in the world’s second-largest economy due on Thursday is expected to add to those fears by showing a contraction in July for the first time in 10 months, according to a Reuters poll. A recent run of weak Chinese data, which prompted a pledge from Beijing on Wednesday to keep growth stable in the second half of 2013, has also undermined commodities though many of these are set for a strong July thanks to the weaker dollar. Brent crude prices eased 0.6 percent to around $106.20 a barrel, extending a 0.6 percent decline on Tuesday, but remain up 4.5 percent this month and on course for their best monthly gain since August last year. Gold gained 0.5 percent at $1,332.86 an ounce. It is up 8.2 percent so far this month, on track to snap a three-month losing run and mark its biggest monthly rise since January 2012, though it is down 20 percent since the beginning of 2013.
Companies in U.S. Added More Workers in July Than Forecast.
Companies in the U.S. boosted payrolls in July by the most this year as employers grew more optimistic demand will pick up in the second half of the year. The 200,000 increase in employment was more than projected and followed a revised 198,000 gain in June that was higher than initially estimated, according to data today from the ADP Research Institute in Roseland, New Jersey. The median forecast of 40 economists surveyed by Bloomberg called for a July advance of 180,000. Job gains, higher stock prices and rising home values are shoring up Americans’ confidence, helping counter the effects of this year’s government spending cuts and giving a boost to U.S. growth. Federal Reserve policy makers, wrapping up a two-day meeting today, are evaluating progress on growth and employment as they consider whether to trim their record monetary stimulus. “The job market has admirably weathered the fiscal headwinds, tax increases and government spending cuts,” Mark Zandi, chief economist at Moody’s Analytics Inc., in West Chester, Pennsylvania, said in a statement. Moody’s produces the figures with ADP. “This bodes well for the next year when those headwinds are set to fade.” Stock-index futures fluctuated as investors awaited the Fed’s policy announcement. Estimates in the Bloomberg survey ranged from gains of 140,000 to 215,000. June’s figure was revised from a previously reported increase of 188,000. 

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Livestock

Lean Hog Paper Likely Open Higher

Look for lean hog futures to open moderately higher this morning, supported by midweek short covering and improving carcass value. On the other hand, the cattle pits will probably start trading on a mixed basis thanks to cautious positioning ahead of more definitive cash and product news.

By John Harrington DTN Livestock Analyst

Cattle: Steady-$1 HR Futures: mixed Live Equiv $130.92 – 0.10* Hogs: Steady-0.50 HR Futures: 10-30 HR Lean Equiv $109.35 +$1.24** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Mixed Early Wednesday

Corn futures are unchanged at 6 a.m. CDT; soybeans higher; wheat higher.
By Darin Newsom
DTN Senior Analyst
6:00 a.m. CME Globex: Corn unchanged, soybeans 2 cents higher (November), and
wheat 1 cent higher.
CME Globex Recap: Grains posted a relatively quiet overnight session with
only soybeans establishing a double-digit trading range. However, soybeans were
near session highs early Wednesday morning while corn and wheat were near
mid-range. Outside commodities were mixed as the U.S. dollar index showed a
small loss and Dow Jones Industrial Average futures posted a small gain.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Cotton

Cotton Creeps Quietly To Slight Gains

U.S. crop conditions improved and drew even with a year ago. Cash sales increased on The Seam.
By Duane Howell DTN Cotton Correspondent

Cotton futures crept to slight gains in quiet dealings Tuesday after finishing in the red two sessions in a row.
Benchmark December hovered up 14 points to 84.85 cents at 7:52 a.m. CDT, trading within a tight 57-point range from 85.22 to 84.65 cents on a contract volume of 1,133 lots. March edged up 11 points to 82.82 cents.
In outside markets, Dow Jones futures gained 39 points and S&P futures 5 points, while dollar index futures eased off 0.023 to 81.740, crude oil dropped 95 cents to $103.60, Brent crude slipped 32 cents to $107.13 and gold gained $2.30 to $1,321.60. Grains were higher.
China’s Zhengzhou cotton futures settled mixed, up 20 yuan or 0.10% in September, up 90 yuan or 0.46% in November and up 110 to down 80 yuan in the other contracts. Prices also closed mixed on the China National Cotton Exchange, while the China Cotton Index continued to slide.
U.S. crop conditions improved during the week ended Sunday, with good to excellent up a percentage point to 45%, fair also up a point to 33% and poor to very poor down two points to 22%, USDA reported.
The DTN cotton condition index improved to 103 from 94 a week earlier and drew even with a year ago. This was up from the low for the season of 90 as of July 14.
Ratings rose in Texas as excellent held at 4%, good gained six points to 28%, fair was steady at 36%, poor dropped two points to 19% and very poor slid four points to 13%. The DTN index for Texas climbed to 59 from 37 a week earlier but was down from 68 a year ago.
Conditions also improved in Arizona, Kansas, Oklahoma, Tennessee and Virginia; held steady in Louisiana, Mississippi and Missouri; and declined in Alabama, Arkansas, California, Georgia and the Carolinas.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update with Mike Kuta " The Squawk Trader "

July 30, 2013
Bank Revenues Surge on Trading Over What Fed Will Do.
Diverging monetary policies are creating ideal conditions for banks to make money from trading currencies as Credit Suisse Group AG to Goldman Sachs Group Inc. say rising volatility is boosting earnings. “If there’s higher volatility, there’s higher volume and higher opportunities for us to generate revenue,” Bernie Sinniah, the London-based global head of corporate foreign-exchange sales at Citigroup Inc., the second-biggest currency trader, said in a phone interview. Volumes in the biggest financial market jumped to a record $5.7 trillion a day in June, according to the latest data from CLS Bank, which operates the world’s largest foreign-exchange settlement system. Deutsche Bank AG and Barclays Plc, which had the highest revenue from currency trading in 2012, published results today while HSBC Holdings Plc reports in the next week. While the Federal Reserve said it plans to reduce the money it pumps into the U.S. economy should a recovery take hold, the European Central Bank is considering additional stimulus and the Bank of Japan announced four months ago an unprecedented bond-buying program. The JPMorgan Global FX Volatility Index jumped last month to the highest level since June 2012.
Stricter Rules:
The rise in price swings should bolster banks’ profits at a time when stricter regulations after the financial crisis threaten earnings from other divisions. The Basel Committee on Banking Supervision’s latest rules, known as Basel III, will force the world’s 101 largest banks to set aside additional capital to cushion against potential losses from businesses such as fixed-income. “Foreign-exchange, which isn’t a heavy consumer of risk-weighted assets or balance sheet, will become more important,” George Athanasopulous, the co-head of global foreign exchange at Zurich-based UBS AG, which reported second-quarter earnings today, said in an interview. “Stringent capital requirements will reduce the footprint of businesses which rely heavily on risk-weighted assets and balance sheet.” Frankfurt-based Deutsche Bank, the biggest foreign-exchange trader, earned the most from this business in 2012 at about $2.7 billion, while Barclays in London received $1.8 billion, according to JPMorgan Chase & Co. estimates on June 28.
‘Significantly Higher’
Both banks reported earnings today. London-based HSBC, which posts results on Aug. 5, was the third-biggest recipient of foreign-exchange revenue last year, JPMorgan estimates. Deutsche Bank, continental Europe’s biggest lender, said second-quarter revenue from foreign-exchange trading rose on increased price swings and greater client activity. Overall profit fell 49 percent to 334 million euros ($443 million), from 656 million euros in the same period a year earlier. UBS, the fourth-largest currency trader, said that increased volatility caused a decline in second-quarter earnings from its foreign-exchange business. Revenue from currencies, rates and credit fell 42 percent to 362 million Swiss francs ($389 million), from 619 million francs in the first three months of this year, UBS said. The investment bank posted a pretax profit of 775 million francs, compared with a 92 million-franc loss a year earlier. Goldman Sachs, located in New York, said this month that its currency-trading operation had “significantly higher” revenue in the second quarter than in the year-earlier period. Like most of its peers, the investment bank doesn’t break out foreign-exchange earnings.
‘Strong’ Activity:
“Activity levels in our currency business remained strong as clients reacted to increased volatility, particularly in Asia,” Chief Financial Officer Harvey Schwartz said on a conference call with analysts. Most banks lump earnings from their fixed-income, currencies and commodities divisions together. Foreign-exchange trading for Group of 10 and emerging-market nations accounted for 15 percent of fixed-income revenue, or about $14 billion, for the 10 largest banks in 2012, according to an estimate from analytics firm Coalition. That’s down from 22 percent in 2011 when most rates and credit operations lost money, Coalition said. U.K. currency-trading volumes rose to a record $2.55 trillion a day in April, 26 percent higher than in October, the Bank of England said yesterday, citing a twice-yearly survey.
Weaker Yen:
The increase was aided by a “substantial” jump in trading of the dollar against the yen, which more than doubled, the central bank said. Japan’s currency has weakened 11.5 percent against the greenback this year. JPMorgan’s foreign-exchange volatility index surged to 11.96 percent on June 24, from 8.07 percent at the end of last year. At 9.7, the gauge is now up 20 percent for the year. Fed Chairman Ben S. Bernanke stoked the surge in volatility when he raised the prospect of the U.S. central bank reducing its $85 billion of monthly bond purchases later this year.In the euro region, ECB President Mario Draghi said he plans to keep the benchmark interest rate at a record-low 0.5 percent for an “extended” period, and that he’s considering additional measures to boost the economy of the 17-nation bloc. The Bank of Japan refrained from adding to its unprecedented monetary stimulus earlier this month and raised its assessment of the nation’s economy, referring to a recovery for the first time since before a record 2011 earthquake. Credit Suisse, Switzerland’s second-biggest lender, said July 25 that increased currency volatility helped boost second-quarter earnings. “Revenues from foreign exchange improved as higher market volatility led to increased client activity,” the Zurich-based bank said in a statement.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

And Now For Something Completely Different — Grains Higher Early Tuesday

Corn futures are higher at 6 a.m. CDT; soybeans higher; wheat higher.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn 3 cents higher, soybeans 2 cents higher (November), and wheat 3 cents higher.
CME Globex Recap: It has basically been a week since grains posted a higher overnight session, with even the bean complex posting modest gains early Tuesday morning. This despite the generally lower commodity markets as the U.S. dollar index is rallying.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Livestock

Meat Futures Set for Mixed Opening

Cattle pits should start with uneven price action tied to follow-through buying on one hand and uncertain fundamentals on the other. Lean hog contracts are also expected to open on a mixed basis as traders struggle with whether the board is discounted too much or not enough.
By John Harrington DTN Livestock Analyst
Cattle: Steady-$1 HR Futures: mixed Live Equiv $131.02 – 0.41* Hogs: Steady-0.50 HR Futures: mixed Lean Equiv $108.11 + 0.45** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Midday Comments on Grains

Mixed Grain Trade at Midday

Grain trade is fairly quiet at midday with mostly lower trade.

By David Fiala DTN Contributing Analyst
Grain General Comments
The U.S. stock market is lower with the DOW futures off 64. The interest rate products are lower. The dollar index is 8 higher. Energies are narrowly mixed. Livestock trade is mostly higher. Precious metals are higher with gold up $10.
CORN
Corn trade is 1 to 3 lower at midday in slow trade. December futures have seen trade from 3 higher to around 5 lower. A new low for the move has been seen keeping the downtrend in place. The weather forecast remains cool, with some moisture for the driest areas. Outside markets are pretty neutral this morning, so little to talk about of significance. The chart picture is negative, the December 10-day is up at $4.91 which is the first notable chart resistance, now that we slipped below $4.75, $4.50 is the next notable support. The weekly export inspections were in the low but in the middle part of expectations at 11 million bushes. Crop ratings this afternoon are expected to remain pretty steady thanks to the cool weather, although maturity will continue to lag.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update with Mike Kuta " The Squawk Trader " Part 2

July 29, 2013
Gasoline Futures Drop as Tropical Storm Dissipates in Atlantic.
Gasoline fell as Tropical Storm Dorian degenerated into a tropical wave, easing concern that it would affect U.S. refining and fuel distribution. Crack spreads narrowed. Futures slipped as much as 1.2 percent. Dorian was downgraded by the National Hurricane Center on July 27. Futures rose 0.9 percent on July 26 and crack spreads widened on the chance that Dorian might strengthen and approach the U.S. Gulf, where 45 percent of U.S. refining capacity is located, or the East coast, including New York Harbor, the delivery point for New York Mercantile Exchange gasoline and diesel contracts. “Gasoline should have opened down today because Tropical Storm Dorian dissipated over the weekend,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. Lipow August-delivery gasoline fell 3.32 cents, or 1.1 percent, to $3.0112 a gallon at 10:06 a.m. on the New York Mercantile Exchange. Trading volume was 18 percent below the 100-day average. Futures slipped 2.5 percent last week, the first weekly loss in a month. Gasoline’s crack spread versus WTI sank 84 cents to $20.60 a barrel. The fuel’s premium to Brent narrowed 94 cents to $18.03. Pump prices, averaged nationwide, fell a seventh consecutive day, dropping 0.3 cent to $3.631 a gallon, Heathrow, Florida-based AAA said today on its website. That’s the lowest level since July 14. Prices are 14.6 cents higher than a year earlier. Ultra-low-sulfur diesel for August delivery fell 0.73 cent to $3.0028 a gallon on trading volume that was 18 percent below the 100-day average. ULSD declined 2.6 percent last week, the first loss in five weeks.
Fed’s Bernanke should testify in AIG bailout lawsuit.
Federal Reserve Chairman Ben Bernanke should testify in the lawsuit by American International Group Inc’s (AIG) former chief Maurice “Hank” Greenberg against the United States over the insurer’s 2008 bailout, a judge ruled today. Judge Thomas Wheeler of the U.S. Court of Federal Claims rejected the government’s effort to keep Bernanke from being deposed, saying the Fed chairman was a “central figure” in the decision to bail out AIG. “Indeed, the court cannot fathom having to decide this multi-billion dollar claim without the testimony of such a key government decision maker,” Wheeler wrote. “These facts constitute ‘extraordinary circumstances’ for the taking of Mr. Bernanke’s deposition.” Greenberg’s Starr International Co, which once had a 12 percent stake in AIG, is suing over the government’s taking of a 79.9 percent stake in the insurer in September 2008 and a separate 1-for-20 reverse stock split in June 2009.
Pending home sales pull back in June as rates rise.
Contracts to purchase previously owned U.S. homes fell in June, retreating from a more than six-year high touched the prior month, suggesting rising mortgage rates were starting to dampen home sales. The National Association of Realtors said today its Pending Homes Sales Index, based on contracts signed last month, decreased 0.4 percent to 110.9. May’s index was revised down to 111.3 from a previously reported 112.3. Economists polled by Reuters had expected signed contracts, which become sales after a month or two, to fall 1.0 percent. Compared to last year contracts were up 10.9 percent. “Mortgage interest rates began to rise in May, taking some of the momentum out of contract activity in June,” said NAR chief economist Lawrence Yun. “The persistent lack of inventory also is contributing to lower contract signings.” Rates on 30-year fixed rate mortgages have climbed about a full percentage point since early May on expectations the U.S. Federal Reserve may begin scaling back its bond-buying stimulus program as early as September. Contracts were up in the West, but down in the Midwest and South. The index for the Northeast was unchanged.
Corn Extends Drop to 33-Month Low on U.S. Crop; Soybeans Decline.
Corn extended declines to a 33-month low in Chicago on speculation U.S. crops will escape damage from hot weather in the next few weeks as temperatures remain cooler than normal. Soybeans also dropped. Temperatures in central Iowa and Illinois, the top two corn-growing states, were forecast to remain below 80 degrees Fahrenheit (27 degrees Celsius) through at least tomorrow, National Weather Service data show. Temperatures in the Midwest and northern and central Great Plains may see “significant, persistent cool weather during August,” AccuWeather Inc. said in a report today. The U.S. Department of Agriculture has pegged domestic production at a record 13.95 billion bushels. “In most areas the crops are growing rapidly and production figures are higher and rising,” economist Dennis Gartman said today in his daily Gartman Letter. “We may well see a corn crop becoming steadily closer to 15 billion bushels.” Corn for December delivery fell 0.3 percent to $4.7475 a bushel by 7:04 a.m. on the Chicago Board of Trade. Earlier, the price touched $4.72 a bushel, the lowest for most active futures since October 2010. Futures fell 4.9 percent last week and traded below $5 a bushel on July 2 for the first time since October 2010. While below-normal temperatures in the next six to 10 days will favor corn pollination, extended cool weather might delay maturity and leave crops vulnerable to an early freeze, forecaster DTN said today. Some dry areas of the Midwest may see rain in the next six to 10 days, benefiting developing soybeans, it said.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Cotton

Cotton Trades With Slight Losses

Trend-following funds bought a weekly net of 294 lots. Cash business sales rose to 794 bales on The Seam.
By Duane Howell DTN Cotton Correspondent
Cotton futures traded with a slight loss Monday after opening the overnight session unchanged and matching Friday’s low.
Benchmark December hovered off 31 points to 84.81 cents at 7:51 a.m. CDT, just off the low of its 83-point range from 84.76 to 85.59 cents on a contract volume of 2,237 lots. March dipped 40 points to 83 cents.
In outside markets, Dow Jones futures traded down 27 points and S&P futures down 3.50 points, while dollar index futures firmed 0.041 to 81.805, crude oil gained 38 cents to $105.08, Brent crude added 44 cents to $107.41 and gold advanced $10.90 to $1,332.40. December corn was lower, soybeans also lower and wheat mixed.
China’s Zhengzhou cotton futures settled lower, down 45 yuan or 0.21% in September and 115 yuan or 0.57% in November. The other contracts fell 290 to 520 yuan. Prices also closed lower on the China National Cotton Exchange and the China National Cotton Index continued to slip.
In U.S. futures-options combined, trend-following funds bought a net of 294 lots during the week ended July 23 to nudge their net long position up 0.5% to 57,349 lots, according to the latest traders-commitments data from the Commodity Futures Trading Commission.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update From Mike Kuta " The Squawk Trader"

July 29, 2013
Investors who love QE should fear Larry Summers.
One of Obama’s top choices of the next head of the Federal Reserve has some reservations about current monetary policy. The White House might be about to add a prominent quantitative easing skeptic to the Federal Reserve: Larry Summers. In speeches, editorials, and recent studies, Summers, who has emerged as a top choice to be the next Fed head, has regularly questioned the wisdom of the U.S. central bank’s signature bond buying program to stimulate the economy. Summers has said quantitative easing, which is meant to lower interest rates, has done less to boost the economy than people think, and he has frequently brought up the program’s potential downsides. At a breakfast hosted by the Wall Street Journal last month, Summers raised the possibility that quantitative easing was creating a bubble and perhaps adding to the nation’s problems with income inequality. “There’s certainly anecdotal evidence of yield chasing by investors who are seeking to earn greater than completely safe rates of return,” said Summers. “To what extent that reflects desirable increases … and what extent that reflects movements towards bubbles is a judgement that … monetary policy authorities will have to make over time.” Summers has also dismissed concerns brought up by Warren Buffett and others that ending QE could shock the markets. In April 2011, at a gathering of economists, Summers said the idea that there would be a big jump in interest rates when the Fed pulls back from the bond market was silly. “Some acquaintance with efficient-market-type notions would lead one to be rather skeptical of that idea,” said Summers at the time. In fact, interest rates have risen sharply in the past two months following suggestions by Ben Bernanke that the Fed would soon wind down its quantitative easing program.
At that same conference, Summers said there were questions about the Fed “exploring multiple instruments” to lower interest rates. For Summers, those questions have persisted. In an editorial for Reuters last summer, Summers wrote, “There is an oddity in this renewed emphasis on quantitative easing.” He said that the slightly lower interest rates that could be generated by more bond buying from the Fed was unlikely to compel business to increase borrowing or make new investments. At a hedge fund conference in April, according to the Financial Times, Summers said his verdict on QE was basically, “meh.” Not much of a help, but not much of a hurt either. “If QE won’t have a large effect on demand, it will not have a large effect on inflation either,” he reportedly said. One of Bernanke’s main justifications for QE is something called the wealth effect. Summers isn’t buying that either. He says just because the stock market is higher doesn’t mean people will spend more. Summers has argued what really boosts spending is higher incomes and, if anything, because of lowered interest rates, QE has lowered incomes, not raised them. Indeed, if Summers had been Fed chair five years ago, quantitative easing might never have occurred.
In September 2008, in an editorial in the Washington Post, Summers suggested that Bernanke might as well pack up his bags and go home. With interest rates already too low, Summers said there was little else the Fed could do to boost the economy. Summers, though, hasn’t always been solidly against QE. Back in October 2011, he wrote it might be a good idea for the Fed to step up its purchases of mortgage bonds. But that was in the context of how to save the housing market. Now that real estate prices are recovering, it’s unclear if Summers would support further purchases. Here’s the thing we don’t know: How much of Summers’ criticism of QE has actually been about QE. Summers has regularly argued that the federal government should be borrowing more money to put toward infrastructure and other projects. Arguing that the Fed and its policies have limited potential to boost the economy, and real downsides, strengthens Summers previous argument for more spending. And, indeed, Bernanke too, at times, has argued for more spending. But in the absence of more cash to spend from Washington, Bernanke has pushed forward with QE anyway. And while Bernanke has said we might be nearing the end of the bond buying program, he committed to continuing QE as long as unemployment isn’t budging. If Summers believes anything he has said in the past five years, why would he.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Livestock

Cattle Pits Staged for Initial Price Strength

Live and feeder cattle futures should open moderately higher, boosted by impressive cash strength in feedlot country on Friday and calls for further weakness in the corn market. Look for lean hog contracts to start on a mixed noted thanks to residual selling on one hand and short covering on the other.
By John Harrington DTN Livestock Analyst
Cattle: Steady Futures: 10-30 HR Live Equiv $131.43 – 0.29* Hogs: Steady Futures: mixed Lean Equiv $107.65 + 0.02** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Start Week Lower Again

Corn futures are lower at 6 a.m. CDT; soybeans lower; wheat lower.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn 1 cent lower, soybeans 10 cents lower (November), and wheat 1/4 cent lower.
CME Globex Recap: Grains were lower again early Monday morning, led by the soybean market. Commercial pressure continues to push bean contracts down, with the new-crop November posting a double-digit loss. Outside commodities were mostly higher, supported by the downtrend in the U.S. dollar index. Dow Jones Industrial Average futures were lower also lower.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DNT Midday Comments on Grains

All Grains Trading Lower at Midday

Lower trade lead by sharply lower soybean trade at midday.
By David Fiala DTN Contributing Analyst
General Comments
The U.S. stock market is lower with the Dow futures off 80. The interest rate products are lower. The dollar index is 27 lower. Energies are mixed. Livestock trade is lower. Precious metals are higher with gold up $8.
CORN
Corn trade is 14 lower on September and 4 lower on December at midday. Commercial firms have dropped basis levels this morning and speculative longs have been liquidation due to losses. There is still a bullish outlook for old crop corn due to the lateness of the crop but that game has changed this week. Those buying cash looking for higher trade very quickly have cash corn worth as much as a buck less. Farmers holding old crop still, also face lower prices for the moment. We still have two months before the old crop game is over, or more. The cooler temperatures are viewed as good for pollination, but they are not good for a crop this late. The weekly export sales were poor for corn. The chart picture now has September below $5, if we can not close back above it bigger long liquidation appears likely into the close. December futures found support at $4.75, expect long liquidatin/sell stops below this level this afternoon.
SOYBEANS
Soybean trade is 30 to 35 lower at midday, meal is off $20 on August to $17 on December and bean oil is off 35-40 points. Outside markets have the dollar lower, crude flat and the stock market lower providing mixed influence. Weather is viewed as nonthreatening to the crop, which is keeping buyers away on weakness. China selling out of reserves to cool off the old crop soybean prices is what helped spark our weakness this week, and now the momentum is strongly down. So this week may get uglier for market bulls. The weather forecasts should control our direction next week, but for this week the longs have taken a good blow the past two days. The weekly export sales numbers were not bad but today was a day the market did not pay much attention to those numbers.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Mornig Comments on Cotton

Cotton Slips On Heels Of Weekly Export Report

U.S. weekly export sales for this season and next rose to a combined 137,500 bales, while shipments continued to lag. Slight rain chances linger in Texas High Plains. Cash business sales fell on The Seam.
By Duane Howell DTN Cotton Correspondent
Cotton futures traded lower and just off session lows Thursday after U.S. weekly export shipments came in below the pace needed to reach the latest USDA estimate.
Benchmark December hovered off 55 points at 85.15 cents at 8:08 a.m. CDT, trading within a 98-point range from 86.10 to 85.12 cents on a contract volume of 1,870 lots. March dipped 22 points to 83.96 cents.
Net U.S. all-cotton export sales for shipment this season and next climbed to 137,600 running bales during the week ended July 18 from 100,600 bales the previous week, USDA reported.
Net upland sales of 33,900 bales for 2012-13 were down 33% from the previous week and 22% from the prior four week average. Gross upland sales were 37,100 bales and cancellations were 3,200 bales. This marketing year ends July 31.
Upland net sales for 2013-14 rose to 100,200 bales from 45,400 bales the week before. These were primarily for Turkey, 21,300 bales; Mexico, 14,700; and China, 12,400.
All-cotton shipments declined to 131,700 bales from 139,800 bales the previous week. Upland shipments of 120,900 bales were down 6% from the previous week and 17% from the prior four-week average.
On the crop scene, a few showers and thunderstorms dotted the northern Texas High Plains overnight. Amounts recorded by the West Texas Mesonet in cotton areas included 0.27 of an inch at Dimmitt, 1.65 inches at Friona, 0.21 at Friona and 0.11 at Plainview. Rain chances in the Lubbock area are 20% Thursday and Friday.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Mornign Comments on Livestock

Lean Hog Contracts Set for Lower Opening

Look for lean hog futures to begin moderately lower this morning, pressured by Wednesday’s large drop in carcass value and further profit taking. The cattle complex is also expected to open with softer price action tied to cash uncertainty and nervous beef demand.
By John Harrington DTN Livestock Analyst
Cattle: Steady Futures: 10-30 LR Live Equiv $131.22 + 0.39* Hogs: Steady-0.50 HR Futures: 10-30 LR Lean Equiv $106.38 – $1.34** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results

DTN Morning Comments on Grains

Grains Set for Another Sell-Off Thursday

Corn futures are unchanged at 6 a.m. CDT; soybeans lower; wheat higher.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn unchanged, soybeans 13 cents lower (November), and wheat 2 cents higher.
CME Globex Recap: The soybean market continues to struggle following the historic collapse in the cash market this week. Fractional gains in corn and wheat aren’t expected to last through the close of the overnight session. Outside commodities are mostly lower with solid selling seen in both metals and energies. Soft markets (e.g. cotton, sugar, etc.) are posting modest gains

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Closing Comments on Cotton

DTN Closing Comments on Cotton

DTN Midday Comments on Livestock; Live Cattle, Feeder Cattle, and Lean Hogs

DTN Midday Comments on Livestock; Live Cattle, Feeder Cattle, and Lean Hogs

Commentary

DTN Midday Comments on Grains

DTN Morning Comments on Livestock

Look for Cattle Futures to Open Moderately Lower

Live and feeder contracts should start moderately lower, pressured by struggling cut-outs and the discount of recent feedlot sales. Lean hog futures are also likely to open in the red thanks to profit taking and odds of late summer/early fall cash weakness.
By John Harrington DTN Livestock Analyst
Cattle: Steady Futures: 10-30 LR Live Equiv $130.83 – $1.40* Hogs: Steady Futures: 10-30 LR Lean Equiv $107.72 – 0.02** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Cotton

Published on 07-24-2013

Cotton Trades Modestly Higher

Solid euro zone data helped to lift stock index futures after earlier data showed another slowdown in Chinese manufacturing activity. Cash business sales increased on The Seam.
By Duane Howell DTN Cotton Correspondent
Cotton futures traded with modest gains Wednesday after opening overnight dealings around session lows.
Benchmark December hovered up 29 points to 85.96 cents at 7:47 a.m. CDT, trading within a 62-point span from 85.51 to 86.13 cents on a contract volume of 1,162 lots. March gained 26 points to 84.30 cents.
Solid euro zone data showing factories increased output for the first time in more than a year helped to lift U.S. stock index futures after earlier data showed another slowdown in Chinese manufacturing activity. HSBC Corp.’s preliminary China purchasing managers’ index declined to an 11-month low of 47.7 this month from 48.2 in June. A score below 50 indicates slowing factory activity.
Dow Jones futures rose 31 points and S&P futures 5.25 points, while dollar index futures gained 0.210 to 82.250, crude oil fell 58 cents to $106.65, Brent crude dropped 93 cents to $107.49 and gold edged up $1 to $1,335.70. December corn was lower, November soybeans higher and September wheat higher at Chicago and Kansas City.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update from Mike Kuta " The Squawk Trader "

July 24, 2013
Factory activity rebounds in July.
Conditions in the manufacturing sector improved in July as firms enjoyed a rebound in new orders, took on new workers and increased output at the fastest clip in four months, an industry report showed today. Financial data firm Markit said its “flash,” or preliminary, Manufacturing Purchasing Managers Index rose to 53.2, a four-month high, from 51.9 in June. A reading above 50 indicates expansion. Output rose to 54.0, also the highest since March, from 53.5 in June. Domestic demand rose and new export orders rebounded after contracting in June. As workloads increased, firms took on more workers, with the employment sub-index rising to 52.6 this month from 49.9 in June. But the rate of job creation remained “disappointingly weak” and well behind the pace seen at the start of the year, said Markit chief economist Chris Williamson, who added that firms are still focusing on cost-cutting to boost combativeness. The “flash” reading is based on replies from about 85 percent of the U.S. manufacturers surveyed. Markit’s final reading will be released on the first business day of the following month. While the manufacturing rebound bodes well for U.S. growth in the third quarter, it is unlikely to persuade the Federal Reserve to hasten the end of its massive stimulus program. “It is likely that policymakers will generally need to see growth strengthen further before sounding more confident about the ability of the economy to withstand any tapering of stimulus,” Williamson said. In a July 5 Reuters poll, the majority of economists at large Wall Street firms said they expected the Fed to start shrinking the size of its debt purchase program by September. The poll was conducted after government data showed the economy had added more jobs than expected in June. Fed Chairman Ben Bernanke has signaled plans to slow down the stimulus program as long as the economy continues to recover as expected. But he also told Congress last week that the central bank’s $85 billion in monthly bond purchases “could be maintained for longer” if the labor market outlook were to darken.
Gold Futures Climb Near 1-Month High on Dollar, Stimulus Outlook.
Gold climbed toward a one-month high in New York as the dollar’s slump and speculation the Federal Reserve will maintain stimulus spurred demand for the metal. The Bloomberg Dollar Index, a measure against 10 major currencies, was little changed near a one-month low after a report showed manufacturing in the euro area’s 17-nation currency bloc unexpectedly expanded in July. Manufacturing in the region covered by the Fed Bank of Richmond unexpectedly shrank in July, data showed yesterday. Gold slid 20 percent this year, set for the first annual drop in 13 years and wiping $56.6 billion from the value of gold exchange-traded product holdings, after some investors lost faith in the metal as a store of value. Gold futures rose 9.7 percent in July, set for the best month since January 2012, after Fed Chairman Ben S. Bernanke said it’s too early to decide whether to begin scaling back bond purchases in September. “The renewed depreciation of the U.S dollar is shoring up gold,” analysts at Commerzbank AG wrote today in a report. “The risk of an abrupt end to the U.S. Fed’s quantitative easing monetary loosening policy has dwindled again recently. Gold is likely to find it relatively difficult to rise above the $1,400 mark, for we believe this would require the ongoing selling by gold ETF investors to come to an end.” Gold for December delivery rose 0.6 percent to $1,342.90 an ounce by 7:47 a.m. on the Comex in New York. Prices reached $1,349.20 yesterday, the highest since June 20. Futures trading volume was 12 percent above the average for the past 100 days for this time of day, according to data compiled by Bloomberg. Gold for immediate delivery in London lost 0.2 percent to $1,342.76.
ETP Holdings:
Gold ETP holdings fell 2.8 metric tons to 1,971.7 tons yesterday, the lowest since May 2010, data compiled by Bloomberg show. The Fed currently buys $85 billion of debt each month. “After the recent rally, bullion may consolidate in the near term,” said Mark To, head of research at Wing Fung Financial Group, a Hong Kong-based precious metals trader and refiner. “Gold has been pressured by the expectation of a slowdown in the pace of asset purchases by the Fed. Any sign of weakness in the U.S. economy will help gold.” Silver for September delivery rose 0.4 percent to $20.335 an ounce in New York. Palladium for September delivery fell 0.3 percent to $737.10 an ounce. Platinum for October delivery was 0.4 percent higher at $1,448.90 an ounce. 

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Higher Early Wednesday

Corn futures are higher at 6 a.m. CDT; soybeans higher; wheat higher.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn 1 cent higher, soybeans 4 cents higher (November), and wheat 2 cents higher.
CME Globex Recap: Grains tried to regain some of what was lost during Tuesday’s sell-off, but were largely unable to create much buying enthusiasm. Soybeans climbed to a double-digit rally before trimming gains by half through early Wednesday morning. Outside commodities were mostly lower while the U.S. dollar index and Dow Jones Industrial Average futures rallied.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

Market Update from Mike Kuta " The Squawk Trader"

July 23, 2013
Bernanke Seen Tapering QE to $65 Billion in September in Survey.
Federal Reserve Chairman Ben S. Bernanke in September will trim the Fed’s monthly bond buying to $65 billion from the current pace of $85 billion, according to a growing number of economists surveyed by Bloomberg News. Half of economists held that view in the July 18-22 survey, up from 44 percent in last month’s poll. Even as expectations of a September taper rose, 10-year Treasury yields continued to fall last week from an almost two-year high after Bernanke said reducing bond-buying wouldn’t constitute policy-tightening. “The markets have adjusted to the new information that the Fed is likely to reduce purchases over the near term, and they’ve come to terms with it,” said Russell Price, senior economist at Ameriprise Financial Inc. in Detroit. “Investors believe it won’t be a strong negative for the markets or the economy.” None of the 54 economists surveyed expects the Federal Open Market Committee to begin paring its purchases at its meeting scheduled for July 30-31. In its first trim, the FOMC will probably cut monthly bond buying by $20 billion, with purchases divided between $35 billion in Treasuries and $30 billion in mortgage-backed securities, according to the median estimate of economists. The central bank will probably halt the asset purchases in the second quarter of next year, according to half of the economists. Twenty-four percent forecast the FOMC will end so-called quantitative easing in the third quarter of 2014. The Fed will buy a total $1.32 trillion in bonds at the completion of its third round of bond buying, according to the median estimate. The FOMC began with $40 billion in monthly mortgage bond purchases in September and added $45 billion in monthly Treasury purchases in December.
Fed Forecast:
The yield on the 10-year Treasury note soared to an almost two-year high of 2.75 percent on July 8 from 2.19 percent on June 18, the day before Bernanke said the Fed may consider reducing bond purchases this year if the economy performs in line with the central bank’s forecast. The yield fell 0.04 percentage point to 2.49 percent on July 17, when Bernanke told a congressional panel that he hasn’t put bond purchases “on a preset course” but will adjust them based on economic data. The yield was little changed yesterday at 2.48 percent in New York. “It would be appropriate to begin to moderate the monthly pace of purchases later this year” if economic data match Fed forecasts, Bernanke told lawmakers. “If the subsequent data continued to confirm this pattern of ongoing economic improvement and normalizing inflation, we expected to continue to reduce the pace of purchases in measured steps through the first half of next year, ending them around midyear.”
Next Update:
The Fed chairman plans to hold his next press conference after the FOMC’s Sept. 17-18 meeting, when Fed officials will next update their forecasts for the growth, unemployment and inflation. Fed Governor Jeremy Stein, in a speech last month, identified the September meeting as a possible time for altering the pace of asset purchases. The FOMC should “be clear that in making a decision in, say, September, it will give primary weight to the large stock of news that has accumulated since the inception of the program,” Stein said on June 28 in New York. The Fed should “not be unduly influenced by whatever data releases arrive in the few weeks before the meeting — as salient as these releases may appear to be to market participants.” Stein’s speech “was very much fixated on September,” said Laura Rosner, a U.S. economist at BNP Paribas SA in New York and a former researcher at the Federal Reserve Bank of New York. Bernanke’s semi-annual testimony to Congress last week “softened the schedule and brought back the data dependence that Stein reduced,” she said, referring to Bernanke’s comment that the FOMC will alter buying based on fresh economic indicators.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Cotton

Cotton Up Slightly After Hitting Eight-Day High

U.S. crop conditions improved slightly. Cash business sales dwindled on The Seam.
By Duane Howell DTN Cotton Correspondent
Cotton futures traded slightly above unchanged Tuesday after benchmark December climbed to an eight-session high overnight.
The December contract hovered up five ticks to 86.24 cents at 8:05 a.m. CDT, trading within a 52-point range from 86.03 to 86.05 cents on a contract volume of 1,647 lots. It posted the session low within about 10 minutes of the opening overnight and the high around 3:20 a.m. CDT.
In outside markets, Dow Jones futures gained 39 points and S&P futures 2.50 points, while dollar index futures edged up 0.033 to 82.350, crude oil fell $1.07 to $105.87, Brent crude eased off 2 cents to $108.13 and gold dipped $6.60 to $1,329.40. Corn traded lower, soybeans mostly lower and nearby wheat lower.
China’s Zhengzhou cotton futures settled higher, up 15 yuan or 0.08% in September, 5 yuan or 0.03% in November and up 10 to 90 yuan in the other traded contracts. Prices closed mixed on the China National Cotton Exchange and the China Cotton Index again was lower.
U.S. crop conditions improved slightly during the week ended Sunday, with excellent steady at 10%, good up two percentage points to 34% and poor down two points at 14%, USDA data indicated after the close Monday.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Lower Early Tuesday

Corn futures are lower at 6 a.m. CDT; soybeans lower; wheat lower.
By Darin Newsom DTN Senior Analyst
6:00 a.m. CME Globex: Corn 7 cents lower, soybeans 3 cents lower (November), and wheat 6 cents lower.
CME Globex Recap: Grains were under pressure for much of the overnight session, with only soybeans trading above unchanged as the session progressed. Early Tuesday morning saw soybeans trying to climb higher again while corn tried to hold above key technical price support. Outside markets were mostly lower again with the U.S. dollar index posting a small gain and Dow Jones Industrial Average futures trading higher once again.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Livestock

Lean Hog Futures Expected to Open with Firm Undertone

The lean hog pit should start moderately higher, supported by recovering carcass value and the premium of the cash index. The cattle complex seem set to open on a mixed basis thanks to short covering and beef demand worries.
By John Harrington DTN Livestock Analyst
Cattle: Steady Futures: mixed Live Equiv $132.23 – 0.34* Hogs: Steady Futures: 10-30 HR Lean Equiv $107.74 + 0.73** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.

DTN Morning Comments on Grains

Grains Mostly Higher Early Friday

Corn futures are lower at 6 a.m. CDT; soybeans higher; wheat higher.
By Darin Newsom
DTN Senior Analyst
6:00 a.m. CME Globex: Corn 2 cents lower, soybeans 12 cents higher (August),
and wheat 2 cents higher.
CME Globex Recap: Strong commercial buying supported the soybean market
overnight, allowing wheat contracts to follow along behind. Corn was sluggish
for much of the session, posting a modest 4-cent trading range. Outside
commodities were mostly higher while the U.S. dollar index is slightly lower.
Dow Jones Industrial Average futures were also posting a loss early Friday
morning.

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The risk of trading futures and options can be substantial. Trading foreign exchange carries a high degree of risk, and may not be suitable for all investors. All information, publications, and reports, including this specific material, used and distributed by Sweet Futures 1, LLC shall be construed as a solicitation. Sweet Futures 1 does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71. This website contains information obtained from sources believed to be reliable, but its accuracy is not guaranteed by Sweet Futures 1. Past performance is not necessarily indicative of future results.