The latest Market Talks covering Commodities. Published exclusively on Dow Jones Newswires throughout the day.
1539 ET - U.S. natural gas futures settle lower for a fourth consecutive session as the summer progresses with solid production and inventories weighing against weather-driven demand. Signals suggest the August contract will see a weak expiration tomorrow, Ritterbusch & Associates says in a note. "With the rollover to the September futures, the weather factor will begin to lose some bite at this later stage of the summer when the market will be forced to look ahead to the low-demand shoulder period." Short-term risk appears heavily tilted downward, the firm adds. Nymex gas for August delivery settles down 3.8% at $2.662/mmBtu and the September contract falls 3.1% to $2.701/mmBtu. (anthony.harrup@wsj.com)
1521 ET - Oil futures extend their slide to three sessions as the pause in U.S. strikes on Iranian targets keeps alive expectations for a return to negotiations and a reopening of the Strait of Hormuz. Disputes over control of the strait has been at the center of the recent flare-up. "For now the market is pricing a temporary calm," Phil Flynn of the Price Futures Group says in a note. "Any credible path toward de-escalation and freer flows through Hormuz would ease one of the biggest risk premiums hanging over crude." WTI settles down 4.1% at $79.26 a barrel, and Brent falls 4.8% to $84.09. (anthony.harrup@wsj.com)
1517 ET - Last week's reports from the USDA didn't show much in terms of a growing cattle herd. While overall inventories were seen as higher from the prior year, supply of cattle on feedlots were shown as declining from the previous month - although they were lower than the same time last year. But many traders are not convinced. "The herd is not getting larger," says ADM Investor Services in a note Tuesday. Most-active live cattle futures on the CME settled up 0.8% to $2.27125 a pound, while lean hog futures rose 0.4% to 88.175 cents a pound. (kirk.maltais@wsj.com)
1434 ET - Gold and silver prices settle lower, as sentiment improves thanks to a lull in fighting between the U.S. and Iran. Petros Pantzari of Monaxa says easing tension is "draining the geopolitical risk premium from markets, helping push Brent and gold lower as traders unwind both supply-disruption fears and defensive safe-haven positions." Crude oil is down around 5%. Front-month gold settles off 0.9% to $4,036.30 a troy ounce, while silver finishes 2% lower at $57.296/oz. (kirk.maltais@wsj.com)
1349 ET - Oil futures steepen losses as the market clings to hopes for talks with the break in military strikes holding. "There's enough signaling that hostilities are on pause for now," says John Kilduff of Again Capital. "I think there's a realization that military operations aren't necessarily the best way to go here, and the U.S. squeezing Iran economically has gotten currency again." Some oil has been getting out of the Persian Gulf, and there's a lot of supply that can come onto the market, he says. "That's why we keep seeing these pullbacks on any ray of hope." WTI is down 4.3% at $79.10 a barrel and Brent is off 5% at $83.92.(anthony.harrup@wsj.com)
1320 ET - Analysts surveyed by Dow Jones this week forecast that the EIA will report inventories of U.S. ethanol to rise from the prior week. Surveyed analysts forecast stocks rising as high as 25 million barrels, which would be up roughly 500,000 barrels from the previous report. If they rise that high, then it would be the highest stocks have been reported since the first week of May. It would also be the third consecutive week that ethanol stocks have accumulated. CBOT corn futures are up 1.5% in afternoon trading, turning higher throughout the day. Soybeans are up 0.7%, after starting the day lower, and wheat is flat for the day. (kirk.maltais@wsj.com)
1022 ET - Live cattle futures on the CME are up 0.5%, seemingly bouncing back after a streak of selling of the most-active contract. But livestock traders are not sure the rally can last. "The downtrend may continue and rallies are likely to be selling opportunities," says the Hightower Report in a note. Because of the measured way that the USDA plans to reopen the U.S.-Mexico border to fed cattle imports from Mexico, the impact of that on prices has likely softened as a flood of imports is not expected at once. Lean hogs are up 0.6%. (kirk.maltais@wsj.com)
0954 ET - U.S. natural gas futures are lower with the market continuing to shrug at summer heat while focusing on strong production, abundant inventories and soft LNG feedgas. High renewable power generation is also seen limiting the amount of gas that would be used to meet air conditioning demand, despite temperatures reaching triple digits in Texas and elsewhere. "Where temperatures are comfortable is across portions of the Great Lakes and Northeast," NatGasWeather.com says in a note. "However, even with hot weather patterns, power burns have been under-performing." Nymex natural gas is down 1.4% at $2.728/mmBtu. (anthony.harrup@wsj.com)
0936 ET - Wheat exports traveling out of Russia are under pressure thanks to closures of major shipping lanes in the Sea of Azov. Market-watchers are not expecting the wartime situation in the Black Sea to change much in the short term, with agricultural research firm SovEcon projecting that Russian wheat exports in the 2026/27 marketing year to fall by 1.9 million metric tons to 44.6 million tons. With no signs of the Russia-Ukraine war subsiding, the shipping lane closures look to stay in place. "A return to normality for wheat exports from the Black Sea region is therefore not on the cards for the time being," says Commerzbank in a note. CBOT wheat falls 0.8% pre-market, while corn is up 0.3% and soybeans fall 0.4%. (kirk.maltais@wsj.com)
0902 ET - CBOT grain futures continue to take their cue from crude this week, with both sliding as optimism builds for a diplomatic solution to end the U.S.-Iran conflict. Because row crops like corn and soybeans are used as feedstock for renewable fuels, they're exposed to crude oil price moves, making today's 2% fall in oil futures a pressure point. "Trump says the U.S. and Iran are having good talks and optimism towards a peace deal being worked out has increased," say analysts with AgMarket.net in a note. CBOT soybeans are down 0.4% premarket, and wheat falls 0.8%, while corn remains up 0.3%. (kirk.maltais@wsj.com)
0849 ET - The USDA says 63% of U.S. corn is in good-or-excellent condition, down 5 points from the prior week. Soybeans are also 63% good-or-excellent, down 3 points from last week. Spring wheat is assessed at 53% good-or-excellent, which is unchanged from last week. Lower quality ratings were expected this week as confirmation that heat stress is affecting crops, but rainfall is expected to ease that stress this week, says Matt Zeller of StoneX in a note. CBOT soybeans fall 0.4% and wheat is down 0.7%, while corn is up 0.5%. (kirk.maltais@wsj.com)
0826 ET - Oil futures extend losses to a third session as the U.S. and Iran continue a pause in their attacks while Iran and Oman explore ways to reopen the Strait of Hormuz. The prospect of a diplomatic off-ramp could keep crude under pressure, although risk premium could be quickly reignited and push prices back above $100, says Nikos Tzabouras of Tradu. "The Middle East conflict has in fact widened," he says, with Houthis attacking Saudi facilities and shipping in the Red Sea. "Any sustained disruption there could leave a market already running on low inventories with limited room to respond." WTI is down 1.3% at $81.55 a barrel and Brent is down 1.6% at $86.96.
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