Perspective: Morning Commentary for April 4

By: Arlan Suderman, Chief Commodities Economist

Tue, 04 Apr 2023, 13:43

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 4 – Stock futures were cautiously higher this morning but concerns about inflation rearing its head again continue to limit gains. The VIX is trading near 19 this morning, which continues to reflect relative calm on Wall Street. The dollar index is trading near 102.1 at this hour, after dropping to an eight-week low below 101.8 earlier this morning. Yields on 10-year Treasuries are rallying to trade near 3.47%, while yields on 2-year Treasuries are trading near 4.02%. It’s the rallying Treasury yields that helped pull the dollar off its session low. Crude oil prices are 1% higher this morning, trading firmly above $81 per barrel, while the grain and oilseed sector is mixed in early trade.

Jobs will be the focus the rest of this week. We’ll get the JOLTS job posting report later this morning, which is expected to show 10.4 million job openings at the end of February. That was essentially the expectation a month ago as well, but the trade was surprised to see 10.82 million job openings, suggesting that the job market remains quite tight. The ADP private sector jobs report is scheduled for release tomorrow morning, with expectations that it will show that the economy created another 200K private sector jobs in March, which is still solid, but down from 242K the previous month. Weekly jobless claims data will be released on Thursday, with expectations that the number will remain relatively tight near 200K claims. The big government monthly jobs report is scheduled for release on Friday morning. It’s expected to show that the economy created a strong 240K jobs in March, although that’s down from 311K in February. However, it’s also expected to show that the unemployment rate remains very low at 3.6%, with average hourly earnings up 4.3% year-on-year.

The Federal Reserve will next meet on May 2 & 3 to re-evaluate its monetary policy. This week’s jobs data will weigh heavily in their assessment of current trends in wage inflation, which is ultimately their biggest obstacle currently to bringing down inflation to their 2% mandate. However, this week’s OPEC+ decision to further cut production will certainly be discussed as well amid projections that their move will risk crude oil prices topping $100 before the Fed meets again in June. The market is well aware of this, pushing the odds in Fed fund futures trading of another rate hike above 60% this morning, after essentially trading 50-50 odds of another rate hike at the end of last week. The market still expects 5% to be the Fed’s peak rate with this round of hikes, but the market hasn’t been right for the past year, so headline risks continue to be a risk for Wall Street.

U.S. Speaker of the House Kevin McCarthy confirmed his intentions to meet with Taiwan President Tsai Ing-wen tomorrow when she stops in California on her way back to Taiwan from her trip to Central America. McCarthy could not give the appearance that China had intimidated him to cancel the meeting, nor could Taiwan’s president do the same. But neither can China back down from its threats to give a strong response to the meeting. Both sides put themselves in a position of conflict from which they cannot back down without yielding authority to the other side. As such, the world now waits for Beijing’s response coinciding with tomorrow’s meeting, continuing the deterioration of the relationship between China and the West. This deteriorating relationship is, and will continue to be, a risk for future commodity trade between China and the United States.

Just 1% of the corn planted in China will contain genetically modified traits this year, according to anonymous industry experts who spoke on the sideline of a recent conference in China. This is a big disappointment to authorities who cleared GMO corn for mass planting this year amid hopes that China would be planting 90% of its acreage to GMO corn within five years. Trend yields in China are just over 100 bushels per acre, which is far below the 181.5 bushels per acre forecast by USDA for the U.S. crop this year. China advanced GMO technology this year in hopes of changing that, and thereby dramatically reducing its dependency on importing critical food commodities.

USDA reports that just 28% of the U.S. winter wheat crop is rated Good to Excellent as of Sunday, which is the lowest reading of the past four decades. The crop’s condition index score that considers all five condition categories is just 279 this week, which ties last year’s crop for the second lowest on record. USDA’s condition ratings go back to 1987. The poor winter wheat ratings are focused primarily on the Plains states, with the wheat-state of Kansas having the lowest condition score of just 230, down from 295 a year ago. The low ratings supported wheat prices overnight, especially with yet another major winter storm expected to add to the deep snowpack in the Northern Plains spring wheat belt over the next couple of days. Increased geopolitical risks with China led to profit taking in corn and soybean prices overnight, but the low wheat ratings combined with planting problems in the Northern Plains focus the trade on tightening global wheat supplies, providing support for the food grain. My world balance sheet continues to tighten in the year ahead for wheat, with the Ukraine war doing little to ease those concerns.

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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

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Perspective: Morning Commentary for August 5

August 5 – U.S. equities markets are on fire this week, with both the Dow Jones and S&P 500 setting new all-time highs yesterday with futures indicating further gains again today; the marketplace remains optimistic over a deal with Iran despite no evidence of such as of yet. Crude oil is working on a lower high and low today but remains slightly on the high side on the session, while the dollar is retreating back towards Monday’s nearly two-month low. The ten-year note is steady-to-lower this morning (though solidly lower so far this month) at 4.605%, while the VIX index continues to rebound into mid-week at almost a 17-point reading this morning.

Matt ZellerWed, 05 Aug 2026, 12:39

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Perspective: Mid-Day Commentary for August 4

August 4 – The Dow Jones is absolutely piling on gains today, adding a similar number that led to yesterday’s record, with the benchmark index now nearing the 54k-point mark through mid-morning. The S&P also hit a new record, while the NASDAQ is exceeding both those gains on a percentage basis. The marketplace is optimistic on a U.S.-Iran trade deal, though the proposed resolution is still being “circulated between the parties”.

Mike CastleTue, 04 Aug 2026, 14:58

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