What Traders are Talking About:
* Payrolls stronger than expected. The U.S. economy added 163,000 non-farm payrolls in July, which was much stronger than the 100,000 jobs traders expected to be added. Despite the stronger-than-expected payrolls, the unemployment rate ticked up to 8.3% from 8.2% in June. May and June non-farm payrolls were revised down a combined 6,000 from previous figures (-16,000 in June; +10,000 in May).
The long and short of it: While the US labor market is far from "fixed," markets are reacting positively to the July jobs data. But with the better-than-expected jobs data, it likely pushes back the timing of any additional economic stimulus investors have been clamoring for.
* Rains coming for some areas. Scattered rains are being seen in the northwestern and southeastern Corn Belt this morning. Those areas are likely to see the heaviest rainfall over the next three days, with the center of the Corn Belt not expected to see much meaningful precip. Based on current models, some locations in the northern and eastern/southeastern Corn Belt will see inch-plus rains through the weekend, but central Belt areas are likely to see a half inch or less.
The long and short of it: Producers are reporting soybean stress has built this week amid the hot and dry conditions thus far. Rains now would be timely, but current forecast models don't signal a well organized rain event is likely.
* Informa August crop estimates out this morning. Informa Economics has been updating its crop forecasts on a regular basis due to drought conditions. The firm will release estimates based on survey work as of Aug. 1 this morning. Of note will be Informa's corn and soybean crop estimates as traders start to prepare for USDA's first survey-based estimates of those crops next Friday.
The long and short of it: While many traders have been focused on yield to this point, harvested acres and production will be the real focal points moving forward.
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