Good morning,
DXH0 99.755 +0.158 GCJ0 1619.6 +7.8 ESH0 3382.00 -5.25 CLJ0 53.96 +0.47
Gold traded to a 7 year high yesterday, and extended the move up overnight. The continued demand for safe haven assets, coupled with the apparent racially motivated shooting in Germany has allowed the flight to continue. Equities are in a slight correction today, after marching to new highs again yesterday. Morgan Stanley just announced an all stock purchase of E-Trade for $13B. Oil continues its bounce as well, trading over $54 in the overnight trade. OPEC+ announced there will not be any emergency meetings now to discuss further production quota cuts in the face of coronavirus, rather they will meet at the already scheduled date of March 5-6. Yesterday afternoon, API projected crude inventories rose last week by 4.16m barrels, above the expected increase of 3.2m barrels.
The dollar traded to a 33 month high against the major currencies yesterday and the Brazilian real was weak again. Sugar futures continue the grind to new highs, as Thailand production concerns outweigh decent cane production out of Brazil. Coffee futures were up slightly, consolidating ahead of first notice day. Lumber futures were up sharply, on the back of the strong housing numbers yesterday morning. Cotton futures continued its strength, driven by the tariff waiver announcement out of China the other night.
Wheat prices, following the huge spike observed on Tuesday, rotated back down yesterday, only to correct back up to post a marginal loss at the close. Corn was down slightly as well, while soybeans traded higher. The grain markets are awaiting the annual outlook from the USDA, which comes at the conference running today and tomorrow. Projections for the coming season’s production and inventory totals in the US are expected. Estimates show increases expected in corn and soybeans, while a steady projection for wheat area planted, and lower production and stocks guesses.
So the market remains focused on coronavirus updates, the US political arena, the bid to dollar assets, highlighted by gold and oil and any potential geo-political issues/tensions.
Technical Moving Averages:
Product 50 day 100 day 200 day
SH0 917.00 925.50 917.75
CH0 384.00 387.75 403.25
WH0 554.25 535.25 522.75
KWH0 472.00 452.25 458.50
MWH0 541.00 539.75 547.50
SMH0 298.6 303.5 308.2
BOH0 32.70 31.82 30.47
CLH0 56.80 55.96 55.90
GCJ0 1545.3 1521.7 1480.2
LHJ0 72.170 75.820 78.065
LCJ0 124.470 123.825 120.060
KCK0 118.90 114.25 111.35
CCK0 2670 2605 2503
CTK0 69.56 67.58 66.41
SBK0 14.06 13.38 13.21
JOH0 98.30 100.65 105.55
HGH0 272.40 268.45 267.80
Thanks,
Mike
Michael Clifford
141 W Jackson Boulevard
Ste 1065
Chicago, IL 60604
Trean Group, LLC
312-604-6404