Economic Downturn Sets Up Surge in Oil Prices

May 19, 2009 07:00 PM

Snapshot of news and events for today

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* Financial markets

* Ag futures

* USDA reports this week

* NWS forecast

* Major media

* Political humorists

Financial markets Major world indicators

Japanese trading...

  • The 225-issue Nikkei Stock Average advanced 54.35, or 0.6 percent, to close at 9,344.64 in Tokyo.

  • Currencies: Japan’s yen advanced to 130.03 per euro as of 7:48 a.m. in London, from 130.81 in New York yesterday when it fell to 131.85, the weakest level since May 13. The dollar rose to $1.3604 per euro from $1.3630. The yen climbed to 95.63 per dollar from 95.97.

Tuesday U.S. Markets...

  • The Dow Jones Industrial Average declined 29.23 points, or 0.3 percent, at 8,474.85.. The Nasdaq Composite Index rose 2.18 points, or 0.13 percent, to close at 1,734.54.
  • The 10-year Treasury note: The gap between two- and 10-year Treasury yields was as wide as 2.360 percentage points at one point Tuesday, the most since the 2.619 points hit in November and nearing the August 2003 peak of 2.747 points. The gap ended Tuesday at 2.352 points, as the 10-year note fell 9/32 point, or $2.8125 for every $1,000 invested, to 99 to yield 3.243 percent, while the two-year note rose 1/32 point to 99 31/32, lowering its yield to 0.891 percent. Prices and yields move inversely.

  • Currencies: Late Tuesday in New York, the euro was at $1.3637 from $1.3553 late Monday. The dollar was at 96.04 Japanese yen from 96.38 yen. The euro was at 130.97 yen from 130.62 yen. The U.K. pound was at $1.5489 from $1.5342. The dollar was at 1.1089 Swiss francs from 1.1142 francs late Monday.

Ag futures Yesterday's action and
overnight indicators

What happened the prior trading day...

  • Corn: Futures finished 4 to 5 cents higher, which was in the middle to upper end of today's range.
  • Soybeans: Futures were mixed in early trade, but quickly firmed amid tightening old-crop stocks. Nearby beans closed 14 to 19 1/2 cents higher, with deferred futures up 6 to 9 cents. Meal and soyoil saw spillover support.

  • Wheat: Futures saw a choppy day of trade, with Chicago and Kansas City closing marginally to 2 cents lower. Minneapolis finished mixed, with nearby contracts weaker and deferreds firmer.
  • Cotton: Futures finished 88 to 133 points lower, which was in the lower end of today's range.
  • Lean Hogs: Lean hog futures closed 20 to 77 1/2 cents lower, as traders worked to narrow the premium futures hold to the cash index.
  • Live Cattle: June and August live cattle futures finished lower, while far-deferred contracts were narrowly mixed. Feeder cattle futures posted slight losses in all contracts.

Scheduled USDA Reports & Summaries This Week

Agricultural Marketing Service = (A)
Census Bureau = (CB)
Economic Research Service = (E)

Farm Service Agency (FSA)

Foreign Ag Service = (F)

National Agricultural Statistics Service = (N)

World Agricultural Outlook Board = (W)






May 18

Grain Inspections (A)
Milk Production(N)
Catfish Processing(N)
Crop Progress (N)


Livestock, Dairy, and Poultry Outlook (E)
Weather - Crop Summary (N)


Broiler Hatchery (N)


U.S. Export Sales (F)
Sugar: World Production, Supply, and Distribution (F)
Catfish Feed Deliveries (N)
Wheat Data (E)
Feed Grains Database (E)


Dairy Products Prices (N)
Livestock Slaughter (N)
Cattle on Feed(N)
Chickens and Eggs (N)
Cold Storage (N)
Farm Labor (N)
Peanut Prices

Overview Other reports affecting agriculture
Major media Links to top news reports
with potential U.S. ag impact

Wall Street Journal (subscription to site required for access)

  • Credit-Card Fees Curbed Sweeping new restrictions on credit-card companies would ban extra fees and fluctuating rates and arm tens of millions of consumers with more information on their debts.
  • Officials Weigh Having One Mortgage Regulator Senior Obama administration officials are discussing giving a federal agency authority to police mortgages and other consumer-oriented financial products as part of the government's broader overhaul of financial regulation, people familiar with the matter said.
  • Californian Voters Reject Budget Measures Californians on Tuesday rejected a series of ballot initiatives to help fix the state's massive budget shortfall, as authorities prepared deep spending cuts in anticipation of the measures' defeat.
  • Need for Speed (Read) to Pass Climate Bill Democrats in the House Energy and Commerce Committee have taken a novel precaution to head off Republican efforts to slow action this week on a sweeping climate bill. They are hiring a speed reader
  • Downturn Sets Up Surge in Oil Prices Energy investment is "plunging" because of the recession, paving the way for oil-price surges within three years, the International Energy Agency warned in a new report.
  • Japan's Aso Urges Calm as Flu Spreads Prime Minister Taro Aso took to the airwaves on Tuesday, urging calm as the A/H1N1 flu virus spread across Japan's western region, prompting school closings and leading some corporations to cancel business trips. Almost 200 people, mainly high school students in western Japan, have been infected with the new strain of influenza. Health experts say they are concerned the virus could spread.
  • Japan's GDP Shrinks as Consumer Spending Feels the Pinch Japan's economy faced its sharpest contraction on record in the first quarter, as the impact of the global economic slump spread from its export sector to domestic consumers. But recent improvements in manufacturing activity indicate that the economy has begun to climb out of the abyss, though at a labored pace.
  • Car Makers Expect to Hit Fuel Goals Car makers embraced the tougher fuel-economy rules, expressing confidence they can hit the targets despite the additional costs and technological challenges.
  • Deere Stock Clings to Memories of the Boom Deere reports second-quarter results on Wednesday, and analysts widely expect the agricultural-equipment maker to cut its outlook for 2009.

New York Times (registration to site required)

  • Bloomberg Navigates the Politics of a Health Scare The H1N1 epidemic has showcased Mayor Michael R. Bloomberg’s strengths — like his ability to dispense common-sense advice — but also shown his weaknesses.
  • Clinton Pledges More Aid to Pakistan The United States pledged an additional $110 million in aid to Pakistan on Tuesday, reflecting both the deepening humanitarian crisis in the Swat Valley and what the administration says is its growing confidence in Pakistan’s efforts to combat the Taliban.
  • Calif. Voters Reject Measures to Keep State Solvent A smattering of California voters on Tuesday soundly rejected five ballot measures designed to keep the state solvent through the rest of the year.

Washington Post

  • U.S. May Add New Financial Watchdog Consumer Agency Under Consideration The Obama administration is actively discussing the creation of a regulatory commission that would have broad authority to protect consumers who use financial products as varied as mortgages, credit cards and mutual funds, according to several sources familiar with the matter
  • Credit Card Restrictions Close to Enactment Landmark credit card legislation, poised to reach President Obama's desk by Memorial Day, will force the card industry to reinvent itself and consumers to rethink the way they use plastic.
  • Little New in Obama's Immigration Policy While Embracing Bush's Programs, President Says Nuance Makes the Difference Although President Obama has spent much of his time in office moving away from the policies of his predecessor, on immigration enforcement, he has embraced several Bush administration initiatives, and the changes he has promised to make are couched in nuance.
  • Cap-and-Trade Debate Drags On in House Energy Committee After lawmakers consumed all of Monday afternoon with opening statements, debate over a bill that would cap U.S. greenhouse gas emissions finally got underway in a House committee yesterday.
  • Swine Flu Spreading in Japan, Forcing School Closures To stop swine flu before it could sneak off airplanes arriving from North America, Japan dispatched masked health inspectors with fever-sensing guns to walk among passengers.
  • Japan's GDP Continues Rapid Decline Annualized 15.2% Drop Is Steepest in 50 Years, 4th in 4 Quarters Japan's export-addicted economy shrank during the first quarter at the fastest pace in more than 50 years, continuing a dismal trend that since last year has made it the worst performer among major countries.
Laughing with, not at From political humorists

Jay Leno: "Hey, there was a private screening of 'Star Trek' at the White House over the weekend. And President Obama said he really liked the film. The best thing about private screenings, because we get to do them – it's not like seeing it with the public, you know, where there might be some moron talking through the whole movie. In fact, that's why they didn't tell Joe Biden."

David Letterman: "You know Vice President Joe Biden? ... Now they're saying...that he apparently had a couple of drinks and he was shooting his mouth off. And he announced the location of Vice President Dick Cheney -- the old Vice President -- his hiding place. ... And Joe Biden says, 'Well, I know where the heck it is. He had, like, a bunker under his house.' And I was thinking...if you're going to reveal secrets about something, why don't you reveal a secret about where bin Laden is hiding."

Jimmy Fallon: "Joe Biden accidentally revealed the location of the Vice President's top secret bunker. ... The guy can't help it. But he did apologize. He said, 'I am so sorry for the mistake. The launch code is 85334. It will never happen again. It will never happen again. My Gmail password is robot23. What am I doing? The house key is under the plant near the doorstep.'"

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