Written Commentary
Market Outlook for US and South America Regions
Grains
After the June USDA report soybeans, corn and wheat futures traded lower. July soybeans traded from 16.50 to 14.50. July Chicago wheat traded from 7.00 and 6.49 and July corn from 7.00 to 6.46. July soymeal dropped from 400 to 370. Futures traded lower on demand concerns.
Lean Hogs
Fifteen months ago the hog industry was collapsing. COVID 19 came when the global hog industry was expanding. Global pork producers expanded because China lost close to 40% of their hog inventories due to African swine fever and China was buying record amounts of pork.
Live Cattle
Boxed beef prices continued rallying from April, gaining $35.00/cwt. Cash cattle prices traded sideways and live cattle futures bounced up and down in a $5.00 range. For the producer, the increasing beef prices in May did not relate with higher cattle prices.
Stock Index Futures
S&P 500 and NASDAQ futures advanced to new record highs in June due to vaccine and fiscal stimulus optimism, along with better than expected quarterly earnings results.
US Dollar Index
The U.S. dollar index advanced after Federal Reserve officials signaled their intention to raise interest rates sooner than previously forecast.
Eurocurrency
The euro currency peaked in late May and has since traded sideways to lower. Euro zone retail sales were down 3.1% from a month earlier in April, following an upwardly revised 3.3% growth in March and compared with market expectations of a 1.2% decline.
Crude Oil
U.S. benchmark crude oil prices fell below $70.00 a barrel due to a quickly-strengthening U.S. dollar, but then recouped some of those losses.
Gold
Gold prices stair-stepped higher in May, increasing to their highest levels since early January, but topped on June 1.
Market Outlook for China and Asia Regions
The key Chinese and Asian event over the last 30 days has been China’s strong performance in foreign trade. Exports and imports jumped 27.9% and 51.1% year-on-year respectively. South Korea’s exports also saw an increase of 45.6% year-on-year, the highest growth rate since 1988.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
