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Grains Show Life Amid Negative Economic News

January 25, 2014
By: Sara Schafer, Farm Journal Media Business and Crops Editor
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Global economic news is dragging down the stock markets, while corn and soybeans close higher.

After several years of positive news, the stock market is retreating. U.S. stocks fell, pushing the Dow Jones Industrial Average toward the biggest weekly decline since May 2012, as equities slumped worldwide amid a selloff in emerging-market currencies, according to a report from Bloomberg.

The Dow Jones will make a key reversal down this week, which is not good," says Jerry Gulke, president The Gulke Group. "Maybe after this four-or five-year run in the stock market, it will take a pause."

Hear Gulke's full audio analysis:

 

He says this negative stock market news is discouraging, because it is a sign of economic instability.

The good news? Corn and soybeans both closed on a positive note on Friday.

"Even with the cold weather out there and rivers being closed, we didn’t collapse grains this week," he says. "That’s the good news. We bought another week of time."

He says corn prices are low enough that the market has likely absorbed a lot of the negative news about the supply situation.

Flip-Flopping China

Another market mover this week was China. Rumors persist that China is cancelling U.S. shipments of grain and/or switching to buy Brazil.

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