6:00 a.m. CME Globex: March corn is down 7 1/2 cents per bushel, March soybeans are down 12 1/2 cents, and March KC wheat is down 8 3/4 cents.
CME Globex Recap: Every asset on the planet except for U.S. Treasuries seems to be sharply lower overnight as fears of the spreading coronavirus hit home. The deadly virus which is spreading across China fits the exact bill of a “black swan” event but unfortunately, it would be the second black swan event in China in as many years.
The outbreaks of African Swine Fever and coronavirus show how far China has to go before they will truly reach the ranks of a developed country.
Grains are sharply lower on fears grain and protein demand could be hit hard in the world’s second largest economy, especially as China heads into its Lunar New Year celebration which is one of the largest drivers of economic activity the entire year. If China has not purchased any U.S. agriculture goods up to this point, we would be surprised if they do it amid this crisis.
OUTSIDE MARKETS: Previous closes on Friday showed the Dow Jones Industrial Average down 170.36 at 28,989.73 and the S&P 500 down 30.07 at 3,325.54 while the 10-Year Treasury yield ended at 1.681%. Early Monday, the March DJIA futures are down 425 points.
Asian markets are lower with Japan’s Nikkei 225 down 483.67 (-2.03%) and China’s Shanghai Composite closed. European markets are higher with London’s FTSE 100 down 176.12 points (-2.32%), Germany’s DAX down 286.6 points (-2.11%) and France’s CAC 40 down 133.73 points (-2.22%).
The March Euro is down 0.001 at 1.110 and the March U.S. dollar index is up 0.030 at 97.680. The March 30-Year T-Bond is up 38/32nds, while February gold is up $11.80 at $1,583.70 and March crude oil is down $1.76 at $52.43. The Dalian Exchange is closed.