Good morning!
Grain markets narrowly mixed overnight… As of 6:00 a.m. CDT, December corn futures were up 3/4 cent, November soybeans down a penny and winter wheat futures were around 3 cents lower. The grain market bulls are still on their heels late this week. However, if the corn bulls can even produce slight price gains today, December futures would end the week with a technically bullish weekly high close. That would be one early chart clue the corn market has put in a price bottom. Conversely, November soybeans and December SRW wheat futures may be on track for chart-bearish weekly low closes today, if the overnight price weakness holds into today’s closes. The key outside markets today see the U.S. dollar index firmer. Nymex crude oil prices are down a bit and trading around $69.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.384 percent.
Sweeping new U.S. tariffs… President Trump late Thursday unveiled a batch of new tariffs on dozens of countries just ahead of the Aug. 1 U.S.-imposed deadline for new deals to be made. The baseline rates for many countries remain unchanged at 10% from the duties Trump imposed in April. Altogether, the average U.S. tariff rate will rise to 15.2% if rates are implemented as announced, according to Bloomberg Economics. That’s up from 13.3% earlier. Most of the tariffs will take effect on Aug. 7. Bloomberg Economics said Canada and Mexico are “well placed to weather the storm” thanks to carve-outs for goods compliant with the USMCA trade deal. Thursday’s new tariffs didn’t apply to China. Trump will decide whether to extend a tariff truce with China after talks with the U.S. wrapped in Stockholm, Sweden earlier this week.
Global markets roiled to start August… President Trump’s sweeping new import tariffs are prompting keener risk aversion across world stock and financial markets on this first day of the month. Europe’s Stoxx 600 fell more than 1% to a one-month low. The MSCI All Country World Index slid 0.3%. South Korean shares tumbled the most since early April. Hong Kong’s Hang Seng index fell 1.1% Friday, for the fourth session in a row of losses and hitting a two-week low. China’s Shanghai Composite fell 0.37%, while the Shenzhen Component lost 0.17% on Friday. Japan’s Nikkei 225 dropped 0.66%, bringing its weekly loss to 1.58%, as tech stocks came under heavy pressure. The U.K.’s FTSE 100 fell over 0.7% on Friday, pressured by global tariff concerns and sharp losses in pharmaceutical stocks. Germany’s DAX stock index fell more than 1%, its lowest price since July 1. U.S. stock indexes are headed for solidly lower openings when the New York day session begins.
It’s U.S. jobs-report Friday… Arguably the most important U.S. data point of the month comes this morning with the employment situation report for July from the Labor Department. Today’s jobs report is forecast to show U.S. non-farm payrolls up around 100,000 jobs from a rise of 147,000 seen in the June report. The overall unemployment rate is seen coming in at 4.2%, after it unexpectedly dipped to 4.1% in June. “Friday’s report is very important, but more than the payroll number, I think we will be focused on the unemployment rate,” said Priya Misra, portfolio manager at JP Morgan. For the Fed to cut interest rates in September, there needs to be clear evidence of the weakening in the labor market, said Misra in a Bloomberg story.
Hedge funds unloading U.S. stocks due to tariff uncertainties… Despite new record highs in the S&P 500 and Nasdaq stock indexes this week, the so-called smart money is selling into the stock market rally. Hedge funds have been unloading U.S. equities the past four weeks, according to a Goldman Sachs desk report and reported by Bloomberg. The hedge funds were unwinding exposure to technology, media and telecom stocks at the fastest pace in a year, ahead of earnings from the sector which has been crucial to the U.S. stock market’s rebound since April. “The funds are sticking to the cautious stance that shielded them during April’s tariff-fueled sell off. And while they have potentially missed out as the S&P 500 rallied to record highs in July, the pullback by the market’s most sophisticated participants may be cause for concern entering a tough seasonal stretch for stocks as trade-war worries linger,” said the Bloomberg report.
Traders still buzzing over copper market debacle… Copper futures prices hovered below $4.40 per pound today and were on track for a weekly drop of around 24%, pressured by a surprise U.S. tariff exemption. President Trump announced earlier this week the newly imposed copper tariffs would apply only to semi-finished products such as wires and pipes, sparing key inputs like ore, cathodes, and concentrates, the most commonly imported forms of copper. Supplies of the red industrial metal had been previously rushed into the U.S. to frontload ahead of the expected tariffs. Analysts now warn the U.S. may face a glut of copper, with excess inventory potentially being re-exported and adding further pressure to global prices. The huge sell-off in copper futures this week spilled over into other metals markets price pressure, including silver, platinum, palladium and even gold.
Midwest weather cooler, but smokey… The National Weather Service today reports there is a slight risk of excessive rainfall over parts of the northern U.S. Plains, southern high Plains and the southern Plains today and Saturday. There may be some severe thunderstorms in these regions, too, including wind gusts, hail, and occasional tornadoes. Localized flash flooding is also possible. Smoke from wildfires in Canada has prompted air quality alerts over the upper great lakes, upper Mississippi Valley and parts of the middle Mississippi valley regions today. On the positive side, the recent heat wave over much of the Midwest and Southeast has been mostly broken.
Palm oil futures slightly up but set for weekly loss… Malaysian palm oil futures edged higher Friday, to around MYR 4,240 per MT, amid bargain hunting after prices dipped to MYR 4,222 in Thursday’s trading session. A weaker ringgit also supported prices, along with data showing top producer Indonesia shipped a solid 11 million MT of crude and refined palm oil in the first half of 2025.
Big sell offs in cattle futures markets Thursday… August live cattle fell $5.30 to $227.775 Thursday, while August feeders fell $7.575 to $331.375. The cattle futures markets saw heavy profit-taking pressure. The bulls may have finally run out of gas on their major bull runs. Strong follow-through selling pressure today would better suggest such. Cash cattle trading so far this week has been light, with USDA Thursday reporting steer prices averaging $237.11, while heifers averaged $234.67. The heavy selling in the futures markets Thursday may give the packers the upper hand as cash negotiations continue late this week.
Lean hog futures market pausing… Steep losses in the cattle futures markets Thursday squelched the hog market bulls. More solid selling pressure in the cattle futures today would likely continue to limit buying interest in hog futures. The latest CME lean hog index price quote today is up 10 cents at $110.51. The projected cash index price for today is down 14 cents to $110.37. The national direct five-day rolling average cash hog price quote Thursday was $112.68.
Today’s reports—Friday
--2:00 pm Agricultural Cash Rent NASS
--2:00 pm Agricultural Land Values NASS
--2:00 pm Cotton System Consumption and Stocks NASS
--2:00 pm Fats and Oils: Oilseed Crushings, Production, Consumption an NASS
--2:00 pm Flour Milling Products NASS
--2:00 pm Grain Crushings and Co-Products Production NASS
--2:00 pm Honey Bee Colonies NASS