What Traders are Talking About:
* Rains about as expected in Argentina. Rains of 0.5 to 1.75 inches were seen over roughly 75% of northern and eastern Buenos Aires, Santa Fe and Cordoba, Argentina, during the past 24 hours. Amounts were about as expected, although coverage was a little more widespread than most forecasters anticipated. Rains will move into northern and eastern production areas of Argentina today before sliding into southern Brazil late tonight and Thursday. A return of hot, dry conditions is expected by Sunday or Monday, although current forecast models aren't as hot or as dry for next week as they previously indicated.
The long and short of it: These rains will help, but more is needed after extended heat and dryness. Still, it's hard for traders to ignore when rains are falling.
* Barrage of USDA reports out Thursday. In addition to its monthly Supply & Demand Report, USDA will release its Annual Crop Production Summary, Quarterly Grain Stocks Report and Winter Wheat Seedings Report Thursday morning. With that much data, traders are unlikely to actively add fresh positions today. Most of today's price activity will be centered on position evening.
The long and short of it: That much data almost certainly guarantees there will be some surprises. USDA's January reports have triggered major price reactions the past five years.
* Euro down, dollar up on Fitch comments. The head of sovereign ratings for Fitch says the European Central Bank should buy more euro-zone debt to avoid a "cataclysmic" collapse of the euro. According to him, Italy is the key for the euro. The comments drove the euro lower and the U.S. dollar index higher overnight. Just yesterday, investors were encouraged by comments from Fitch that they don't see a downgrade for France over the next year.
The long and short of it: The U.S. dollar index continues its recent strength, although it's currently trading below Monday's intra-day high.
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