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DAILY AG MARKET VIEW REPORT 

January 16, 2020  |  Follow us on Twitter @TradeADMIS  |  Download PDF

Soybeans, soyoil, corn and wheat traded lower. Soymeal traded unchanged. US stocks were higher. US Dollar was higher. Crude was higher. 

SOYBEANS

Soybeans traded lower. Traders appeared to have sold the news of a new trade deal with China. Some fear that China may not buy US soybean until they need it and the price is right. Last week on China official suggested China may buy 10 mmt US soybean for October. Weekly US soybean export sales were near 26 mil bu. Total commit is near 1,120 mil bu vs 1,115 last year. USDA goal is 1,775 mil bu vs 1,748 last year. South America weather remains favorable for crops. March soybeans rejected recent highs near 9.60. Lack of USDA lowering US 2019 soybean crop and US 2019/20 carryout and favorable South America weather offered resistance. Selling accelerated today when March soybean traded below moving average near 9.28. There is some support near todays low and 9.21. Key support so far this year has been near 8.80.

Soybeans COT Chart

CORN

March corn futures traded sharply lower. Slow pace of US corn export trade, disappointment in the lack of details concerning the new US and China trade deal, fact China can buy US Ag goods when the need it and when the price is right and poor ethanol margins may have triggered increase selling. Fact March corn traded below the last moving average support level near 3.83 also suggested the trend has turned lower. Most feel China will adhere to the trade deal but not sure when, what commodity and how much. Weekly US corn export sales were near 31 mil bu. Total commit is near 760 mil bu vs 1,271. Most now doubt China will be a big buyer of US corn until later in 2020. USDA export goal is 1,775 mil bu vs 2,065 last year. Without China some feel final exports could be closer to 1,700. The negative side of the 2020 corn market is favorable South America weather could increase export supplies there. Also, US farmers could plant a record amount of corn acres in 2020. This could add to US 2020/21 supplies.

Corn COT Chart

WHEAT 

Wheat futures traded lower. Recent price gains has been linked in part to concern over slower Russia export pace, logistic problems in France due to protest strikes and talk that once the US and China trade deal was signed, China could be a buyer of US wheat. The disappointment in the lack of details concerning the new US and China trade deal, fact China can buy US Ag goods when the need it and when the price is right weighed on futures today. Weekly US wheat export sales were near 24 mil bu. Total commit is near 719 mil bu versus 658 last year. Most doubt for now China will be a big buyer of US wheat. USDA export goal is 975 mil bu vs 936 last year. The negative side of the 2020 wheat market is favorable global weather could increase export supplies there.

Wheat COT Chart
 

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 Archer Daniels Midland Company.  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.

  DAILY AM FINANCIAL MARKET OUTLOOK REPORT 

Jan 16 Traders Focusing on Corporate Earnings  PDF

STOCK INDEX FUTURES
 

Stock index futures are higher, with S&P 500 and Dow futures at new record high, as traders focus on company earnings.

Retail sales in the U.S. increased 0.3% on a monthly basis in December, which was in line with market expectation and also matched the previous month’s upwardly revised reading. Retail sales, excluding autos, were up 0.7% when a gain of 0.5% was anticipated. 

Initial jobless claims remain at historically low levels, coming in down 10,000 to 204,000 in the week ending January 11. Economists expected jobless claims would be 216,000.

The Philadelphia Federal Reserve’s January manufacturing index was 17.0 when 4.0 was estimated by analysts.

The 9:00 central time January housing market index is expected to be 75 and the 9:00 November business inventories report is expected to be down 0.1%.

I anticipate U.S. stock index futures will continue to trend higher in January.

CURRENCY FUTURES 

The euro currency is steady following the release of the European Central Bank's minutes of its monetary policy meeting in December.

The ECB said there had been solid upward movement in underlying inflation.

The British pound is a little higher, but is likely to trend lower longer term, as it is becoming more likely that the Bank of England will lower its key lending rate this year.

The Canadian dollar is higher after it was reported that the Automatic Data Processing Canadian December employment report showed a gain of 46,200, which compares to the 30,900 increase in the prior month.

INTEREST RATE MARKET FUTURES

Futures are lower, as flight to quality longs continue to be liquidated in light of yesterday’s signing of the U.S.-China trade deal and the bearish influence of higher stock index futures.

Michelle Bowman of the Federal Reserve will speak at 9:00.

There is a 57% probability that the Federal Open Market Committee will lower its fed funds rate at its December 16, 2020 policy meeting. Yesterday the probability was 57%.

Interest rate market futures are likely to trade broadly sideways in the longer term, although the flight to quality influence will likely reemerge from time to time.

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 Archer Daniels Midland Company.  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. 

MONTHLY COMMODITY MARKET REVIEW

This special monthly report recaps the financial, energy, metal, currency, grain and livestock market trends exclusively by the ADMIS Research Team.

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INFOGRAPHIC SNAPSHOTS

USDA SUPPLY/DEMAND REPORT (released January 10)
January 10 USDA Report
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FOMC MEETING OUTLOOK (Oct 30)
FOMC Meeting
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