6:00 a.m. CME Globex: May corn is up 1 cent per bushel, May soybeans are up 2 1/4 cents, and July K.C. wheat is up 4 1/4 cents.
CME Globex Recap: Equities are mixed Wednesday morning, but they remain strong compared with commodities as equity/commodity ratios hit new record highs on Tuesday. Passive-long index funds have been dumping commodities, specifically grain commodities, most of 2019.
So far, this has been a winning strategy, but it does beg the question of whether commodities once again look “cheap” relative to equities and could bring in some buying interest.
Grains are bouncing Wednesday morning, mostly on a technical rebound, with planting delays still not providing the upside catalyst bulls think they should. In addition, enough demand concerns exist to prevent the sizable short-covering by managed funds which would be needed to flip longer-term trends.
OUTSIDE MARKETS: Previous closes on Tuesday showed the Dow Jones Industrial Average up 67.89 at 26,452.66 and the S&P 500 up 1.48 at 2,905.58 while the 10-Year Treasury yield ended at 2.592%. Early Wednesday, the June DJIA futures are up 28 points.
Asian markets are higher with Japan’s Nikkei 225 up 56.31 (0.25%) and China’s Shanghai Composite up 9.52 points (0.29%). European markets are mixed with London’s FTSE 100 down 4.14 points (-0.06%), Germany’s DAX down 3.58 points (-0.03%) and France’s CAC 40 up 5.21 points (0.09%).
The June Euro is up 0.002 at 1.140 and the June U.S. dollar index is down 0.107 at 96.545. The June 30-Year T-Bond is down 7/32nds, while June gold is up $0.40 at $1,277.60 and May crude oil is up $0.39 at $64.44. Soybeans on China’s Dalian Exchange were down -0.3% while soybean meal was down -0.43%.