Harold House with the Kansas City Trade Group suggests that it will be a quiet day Thursday as far as the markets go. Click below to hear KMZU’s Mandy Young talk with Harold House from the Kansas City Trade Group.
Initial moves in the lean hog futures market are expected to remain mixed with some pressure developing in deferred futures through overnight trade. The potential for end-of-week positioning is strong given the strong support over the last couple of weeks.
Cattle: Cash: Steady-$1 Lower Futures: 10-30 Higher Live Equiv. $137.18 – $0.39
Cash cattle trade remains at a virtual standstill heading into the day Thursday. Packer interest is expected to pick up through the morning, with additional bids likely. At this point any bids seen through the market are likely to be well below asking prices and unlikely to get much attention until at least mid-day. Asking prices are likely to be restated around $124 in the South and $200-plus in the North. Live and feeder contracts should open slightly higher with light follow-through support developing in the overnight futures market that could draw additional light buying complex.
Hogs: Cash: Steady-$1 Lower Futures: Mixed Lean Equiv. $108.56 + $1.96
The continued search for hogs continues to create additional momentum in the cash markets. The triple digit gains seen Wednesday continues to limit the focus on a potential strong pullback in the market. Weekend processing schedules are expected to be held at a minimum, which could allow for some softness in the market as traders need to find fewer ready pigs over the next couple of days for weekend schedules. Lean futures are expected to pen mixed with light support developing in the nearby contract while deferred contracts seem to be concerned about an overbought situation.
Grain contracts traded both sides of unchanged overnight with narrow ranges seen in both corn and wheat. Markets seem to be following technical patterns closely at this time as fundamentals remain an unknown variable.
Outside markets continue to feed off the recent selling in global equities. Most commodities were lower despite another sell-off in the U.S. dollar index. The Dow Jones Industrial Average closed 126.79 points lower Wednesday at 14,995.23. The overnight session saw the Dow Jones futures trade 83-points lower, indicating U.S. stocks could see continued selling interest Thursday. The overnight crude oil market was $0.43 lower at $95.45 while Brent crude was $0.29 lower at $103.20. The August gold contract lost $6.50 to close at $1,385.50, while the U.S. dollar index lost 0.177 at 80.770. Soybeans at the Dalian Exchange were lower while Malaysian palm oil contracts were also lower.