Perspective: Morning Commentary for August 5

By: Arlan Suderman, Chief Commodities Economist

Fri, 05 Aug 2022, 13:30

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

August 5 – Stocks were quietly mixed overnight ahead of this morning’s monthly jobs data, which provided additional information about the strength of the U.S. economy, although stocks came under pressure following the report’s release. Traders also continue to monitor the conflict with China surrounding Taiwan, with military activity escalating around the island nation. The VIX traded either side of 22 overnight and this morning, while the dollar index traded sharply higher near 106.8 on the jobs data. Yields on 10-year Treasuries are trading near 2.83%, while yields on 2-year Treasuries are trading near 3.24%. Crude oil prices fell to a fresh six-month low, while the Ags are mostly lower as well in the selloff.

The economy created 528K jobs in July, more than doubling the 250K that was expected by analysts. In addition, the June number was revised to 398K jobs created, up from the 372K originally reported. The unemployment rate ticked lower to 3.5%, when analysts thought it would stay unchanged at 3.6%. The private sector created 471K jobs in July, up from an upwardly revised 404K in June and more than twice the 220K expected by analysts. The job participation rate fell to 62.1% in July as more people dropped out of the labor force. Hourly earnings rose by 0.5% month-on-month in July, up from analyst expectations of 0.3% gains, and June was revised upward to 0.4%. Average hourly earnings were up 5.2% year-on-year in July, matching the upwardly revised number for the previous month, and above analyst expectations of 5.0%. The average workweek was unchanged at 34.6 hours.

This is not a report that you would expect in a recession. Put this together with the recent JOLTS report showing roughly 10.7 million job openings, which is just below recent record highs, and we still have a very tight jobs market. Wage inflation remains greater than anticipated, and these reports suggest that we’re not yet seeing an easing of that wage inflation. I wrote yesterday that one of the unsavory jobs of the Fed – that it will not publicly state – to get inflation under control is to increase the unemployment rate closer to 5.5% to provide some relief to wage inflation. It’s steps toward monetary tightening have not yet had that effect. Current fiscal and monetary policies have not yet done much for easing inflationary pressures that pose a more significant longer-term risk to the economy. One can even argue that some of the policies are making it worse. As such, the hawks at the Fed will see this report as fodder for maintaining their current hawkish policy trajectory, which was not missed by Wall Street traders this morning.

China “flew more than 100 warplanes including fighters and bombers” in its military exercises surrounding Taiwan thus far, according to its state-run media. The exercise involved troops from the navy, air force, rocket force, strategic support force and logistic support force, according to the reports. Some of the fired missiles crossed over Taiwan in strategic locations where the island nation reportedly has Patriot missiles densely deployed as part of its defense system in the event of an actual attack. This is the first time China has conducted such exercise surrounding the island nation, including on its back side. China also either canceled or suspended dialogue with the United States on a broad assortment of issues, including climate change, military relations, and anti-drug efforts, among other things, while also sanctioning U.S. House Speaker Nancy Pelosi as relations continue to deteriorate.

Ukraine exported 1.7 million metric tonnes of grain in July, virtually all of it over land routes, which was up from 1.4 mmt in June. The shipments included 1.2 mmt of corn, 376K tonnes of wheat and 149.7K tonnes of barley. That number is expected to rise in August as ships begin to leave three of Ukraine’s ports under the recently reached agreement. Those three ports had a maximum monthly volume of 3.6 mmt prior to the war, although reaching that volume under the terms of the agreement isn’t likely. Three ships left the ports this morning, creating a sort of caravan departure, with two of them departing the port of Chornomorsk and one the port of Odesa. All three will follow a leading ship that will lead them through the mine fields. The three are carrying a little over 58K tonnes of corn, as we have not yet seen large ships participate in the program. That will limit the export volume. Dozens of ships remain trapped at the ports dating back to February when the war began. Those ships obviously want to get out. The first empty in-bound ship is scheduled to arrive on Saturday, but again we continue to wait for the Panamax ships to participate.

China bought multiple U.S. soybean cargoes overnight, according to our sources within China, despite heightened tensions between the two countries. USDA thus far confirmed the sales of two cargoes sold to China and two to unknown destinations, which will be presumed to be China. The grain and oilseed markets continue to be influenced by macro-economic factors on Wall Street, where traders are convinced that we are in a recession which will hurt demand, but also where inflation remains well entrenched. But fundamentally, weather over the next several weeks will determine whether supply matches with anticipated demand for the coming year. An anticipated rain event this weekend in portions of the western Midwest is probably essential if we want to maintain hopes for that to happen.

Grains & Oilseeds
Base Metals
Precious Metals
Digital Assets
Energy
Dairy
Cocoa
Coffee
Cotton
Sugar
Meats & Livestock
Forest Products
Currencies
Interest Rates

This material should be construed as market commentary and represents the opinions and viewpoints of the author, and does not reflect tailored advice associated with any specific account.

The views are current only through the date stated and are subject to change at any time based upon market or other conditions, and StoneX Group Inc. (“SGI”) disclaims any responsibility to update such views. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. Past performance does not guarantee future results.

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided.

References to certain OTC products or swaps are made on behalf of StoneX Markets, LLC (SXM), a member of the National Futures Association (NFA) and provisionally registered with the U.S. Commodity Futures Trading Commission (CFTC) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ and who have been accepted as customers of SXM.

StoneX Financial Inc. (SFI) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI is registered with the U.S. Securities and Exchange Commission (SEC) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Advisor. StoneX Financial (Canada) Inc. (SFCI) is registered in Canada and is a member of CIRO and CIPF. References to certain securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to certain exchange-traded futures and options are made on behalf of the FCM Division of SFI. Wealth Management is offered through SA Stone Wealth Management Inc., member FINRA/SIPC, and SA Stone Investment Advisors Inc., an SEC-registered investment advisor, both wholly owned subsidiaries of SGI.

R.J. O’Brien & Associates, LLC (RJO) is registered with the CFTC as a Futures Commission Merchant and is a member of NFA.

StoneX Financial Ltd (SFL) is registered in England and Wales, company no. 5616586. SFL is authorized and regulated by the Financial Conduct Authority (FCA) (registration number FRN:446717) to provide services to professional and eligible customers including: arrangement, execution and, where required, clearing derivative transactions in exchange traded futures and options. SFL is also authorized to engage in the arrangement and execution of transactions in certain OTC products, certain securities trading, precious metals trading and payment services to eligible customers. SFL is authorized and regulated by the FCA under the Payment Services Regulations 2017 for the provision of payment services. SFL is a category 1 ring-dealing member of the London Metal Exchange. In addition SFL also engages in other physically delivered commodities business and other general business activities which are unregulated and not required to be authorized by the FCA.

This communication is issued in the European Economic Area by StoneX Financial Europe GmbH (SFEG). StoneX is the trade name used by STONEX GROUP INC. and all its associated entities and subsidiaries. StoneX Financial Europe GmbH (“SFEG”) is a securities trading firm registered in Germany under Company No. HRB 80844.

StoneX APAC Pte. Ltd. (“SAP”) (Co. Reg. No 200616676W) is regulated as a Dealer (PS20190001002) under the Precious Stones and Precious Metals (Prevention of Money Laundering and Terrorism Financing) Act 2019 for purposes of anti-money laundering and countering the financing of terrorism. SAP is an “Approved International Trading Company” authorized to act as a “Spot Commodity Broker” under the Commodity Trading Act.

StoneX Financial Pte Ltd (Co. Reg. No 201130598R) (“SFP”) is regulated by the Monetary Authority of Singapore and is a Capital Markets Service Licence holder (for dealing in capital market products), an Exempt Financial Adviser (for advising on investment products and issuing or promulgating analyses/ reports on investment products) and a Major Payment Institution (for domestic and cross-border money transfer services).

SFP may distribute analysis/report produced by its respective foreign affiliates within the StoneX Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations Recipients should contact SFP at (65) 6309 1000 for any matters arising from, or in connection with, this webinar.

StoneX Financial (HK) Limited (CE No.: BCQ152) (“SHK”) is regulated by the Hong Kong Securities and Futures Commission for Dealing in Securities and Dealing in Futures Contracts.

StoneX Financial Pty Ltd (ACN 141 774 727) holds an Australian Financial Service License (AFSL: 345646) for Dealing in Securities, Exchange-Traded Derivatives Contracts, OTC Derivatives Contracts and Foreign Exchange Contracts, and is regulated by the Australian Securities and Investments Commission.

StoneX Securities Co., Ltd. (“SSJ”) (Co. Reg. No 010401047199) is regulated by the Japanese Financial Services Agency as a Type-I Financial Instruments Business Operator (Kanto Local Finance Bureau (FIBO)No.291’), is a member of the Financial Futures Association of Japan for dealing and broking FX and FX Option transactions, and is a member of the Japan Securities Dealers Association for dealing and broking stock indices and option transactions.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. Past performance of any futures or option is not indicative of future success. Indicators are not a trading system and are not published as a specific trade recommendation. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

The report/analysis herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

Satellite view of Earth at night showing illuminated cities across Asia and the Middle East

Discover more insights

Our subscribers have access to comprehensive market analysis from StoneX spanning commodities, equities, currencies and more.

Explore subscriptions

Perspective: Morning Commentary for August 7

August 7 – The U.S. economy unexpectedly lost 23k jobs in July, dramatically below market expectations of an 80k increase and marking the worst Non-Farm Payrolls print since February. Furthermore, May and June were both revised sharply downward, with combined revisions showing 103k fewer jobs than previously reported. Outside of the healthcare sector, which added 22k jobs in July, the losses were very broad-based. Government payrolls saw the largest decline, shedding 53k jobs in July, the largest seen since October 2025, while June was revised down to show a loss of 10k jobs as well. The private sector at least saw growth, adding 30k jobs in July, now matching the month prior after it was revised down from the 49k initially reported, and substantially missing forecasts of 78k jobs being added. This is a sharp reversal in course from the largely better than expected U.S. labor data seen earlier this week.

Mike CastleFri, 07 Aug 2026, 13:26

Grains & Oilseeds
Energy
Dairy
Renewable Fuels
Cocoa
Coffee
Cotton
Sugar
Meats & Livestock
Forest Products

Perspective: Morning Commentary for August 6

August 6 – This morning’s stronger-than-expected U.S. labor data offered markets some relief, reinforcing confidence in the economy while giving the Fed greater flexibility to raise rates should inflationary pressures reaccelerate in next week’s July data. Stock futures are pointing to a mixed open to start the day, with the tech-heavy Nasdaq showing the most weakness. The VIX has fallen notably from yesterday’s spike above 18.4 as it starts the day hovering just below the 16-mark. The dollar is quietly higher as it trades just above 99.8, holding in the tight range seen thus far this week as traders continue to digest data to shape expectations for the Fed’s next move, which we’ll dive into in more depth below. Long-term treasury yields have relaxed slightly from their recent spike, with 30-year yields starting the day trading just above 5.19%, while 10-year yields trade above 4.64%, and 2-year yields sit below 4.22%. Crude oil is modestly higher to start the session after sharp declines earlier in the week, with nearby WTI up 1.8% to trade at $76.40 and nearby Brent up 2.4% to trade at $81.40. Meanwhile, the ags are quietly mixed to start the day.

Mike CastleThu, 06 Aug 2026, 13:24

Grains & Oilseeds
Energy
Dairy
Renewable Fuels
Cocoa
Coffee
Cotton
Sugar
Meats & Livestock
Forest Products

Perspective: Mid-Day Commentary for August 5

August 5 – The Dow Jones is ripping higher for yet another session, up safely over 500 points at the time of this writing to carve out another record high; the S&P and NASDAQ are a bit less enthusiastic but the former is still making its own record high, while the latter is less than 500 points off its own top thanks to a strong ongoing week of trade. The dollar is churning lower this morning in an effort to re-test Monday’s 1 ½-month low, while the ten-year note has flipped higher in the mid-morning hours. The CME FedWatch tool interesting has market odds of a quarter-point rate hike next month coming closer to a 50-50 proposition as crude oil prices decline.

Mike CastleWed, 05 Aug 2026, 15:19

Grains & Oilseeds

StoneX: We open markets

Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.

Reach

With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bilateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.

Transparency

As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve, our financials and track record are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.

Expertise

From our proprietary Market Intelligence platform to “boots-on-the-ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.