Pro Farmer Senior Markets Editor
From Pro Farmer
Updated as of 7:00 a.m. CT
Grains higher overnight on help from outside
markets... Grain futures were higher overnight, with help coming
from outside markets. The U.S. stock market is set to open higher this morning,
as investors are showing their optimism about the Obama administration's plan
to seek the help of private investors in an effort to rid banks of bad assets.
Yesterday, the government said it would subsidize private investors' purchase
of "toxic assets" on banks books that have led to the seizure of the
credit markets. The dollar was weaker overnight, with crude oil stronger.
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Opening calls. These calls originate more than three hours before the open -- use caution, things change:
Corn: 6 to 7 cents higher. Futures were higher overnight on help from
outside markets. Futures saw a narrowly mixed day of trade on Friday to cap
off a solid week of gains. For the week, May corn closed about a dime above
the previous week's level and saw some technical chart improvement. Now key
will be if futures can add to the upside momentum this week and post consecutive
closes above $4.00 to signal a low has been posted. Futures were bolstered
by hopes the economy is turning around, with investors putting more confidence
in the economy after last week's aggressive moves by the Federal Reserve.
Soybeans: 20 to 30 cents higher. Futures were sharply higher overnight
on help from outside markets. Futures posted strong gains last week. Bulls
carry momentum into this week after a strong price performance. But the market
is susceptible to profit-taking, especially if outside markets aren't price-supportive.
Unless tensions ease in Argentina, however, the downside should be limited,
as the U.S. is likely to pick up more near-term export demand.
Wheat: 10 to 12 cents higher. Futures faced light profit-taking Friday,
but posted very solid gains for the week. Traders' attention will primarily
by on outside markets this week. But they will also keep a watch on the weather.
Wheat futures are in the follower's role, which is expected to lead to strength
in the early going.
Cash cattle expectations: Watching
beef, hopeful of near-term low. The combination of $2 higher cash cattle
trade in the Plains late last Friday and the friendly Cattle on Feed Report
should provide support for cattle futures to start the week. Also, strong support
is expected from the stock market as traders are becoming more hopeful the worst
of the economic conditions have passed.
Futures call: Higher. Futures are called to open higher this morning
based on strength from outside markets and Friday's
positive COF Report. Friday, June live cattle closed 75 cents above the
previous week's close, supported by the burst in outside markets. Last week's
moves by the Fed to pump more money into the economy, has traders more hopeful
the economy is turning around. Key this week will be if that attitude is maintained.
Cash cattle trade was higher last week, which has traders thinking a near-term
cash low may have been secured.
Cash hog expectations: Steady.
Cash hog bids are expected to start the week steady at most Midwest locations.
Packer demand for hogs is expected to be improved amid positive cutting margins,
while available market-ready supplies are likely to be slightly less than last
week. If the pork market can show strength, packers may increase kill runs late
in the week.
Futures call: Steady to higher. Futures are called to open steady
to higher based on helpful outside markets. Futures faced profit-taking pressure
Friday and finished the week lower than the previous Friday's close. With
the poor close, bears carry momentum to start the week. But seller interest
should be limited unless the cash market is under heavy pressure as traders
feel prices have started a seasonal recovery. Late-week trade will be dominated
by preparations for USDA's Quarterly Hogs & Pigs Report this Friday.