Perspective: Morning Commentary January 26

By: Arlan Suderman, Chief Commodities Economist

Mon, 26 Jan 2026, 13:20

January 26 – Both stocks and the U.S. dollar took a hit overnight as traders fretted about increased tensions with Canada and concerns that Japan may be about to intervene in the currency market, although both were also well off their lows this morning. There’s also a bit of nervousness about fourth quarter earnings for big tech companies, as well as the January meeting of the Federal Open Market Committee that commences tomorrow. The VIX is trading near 17, while the dollar index is trading at a fresh four-month low below 97.3. Yields on 10-year Treasuries are trading near 4.21%, while yields on 2-year Treasuries are trading near 3.59%. Crude oil prices are modestly lower at this hour, while the grain and oilseed markets were quietly mixed in overnight trade.

China is astir today. No, you won’t hear it discussed in public places, but there’s a buzz underlying the calm on the streets as President Xi steps up his purge in the leadership of China’s military. Two more people were removed from their positions facing investigation of corruption. Zhang Youxia was a member of the Political Bureau of the CPC Central Committee and he was vice-chairman of the Central Military Commission (CMC). Liu Zhenli was a member of the CMC and Chief of the Joint Staff Department of the CMC. They are suspected of serious violations of Party discipline and law. Zhang Youxia had a strong longstanding relationship with Chinese President Xi Jinping, as well as another CMC member. The fact that yet another CMC vice-chair and Politburo member with a relationship with Xi went down is shocking inside of China. State media wasted no time in dismantling these men’s reputations. Zhang is reportedly being accused of corruption and with not reigning in close associates, family members, and relatives. He has also been accused of not immediately bringing problems to the attention of Party leadership. When one reads what state media reports about these two men, it gives the sense that perhaps President Xi saw them as undermining him in the military.

So what does this have to do with commodities? The handshake trade deal of October 30 was good for China buying 12 million metric tons of U.S. soybeans, as well as purchases of various other commodities provided hope for a market that’s currently over-supplied. I stated at the time that we got the deal because President Trump wanted to calm the international waters ahead of the 2026 midterm elections, in which he could see his agenda suffer a serious hit if he loses Congress. The other reason we got the deal was that President Xi came out of the 15^th Fourth Plenum meeting of the Communist Party of China in late October realizing that he too needed to calm the international waters to shore up his support base at home. I’ve also said that there are two flashpoint issues that could unravel the deal – Taiwan and rare earth minerals. The rare earth minerals issue is quiet for now. The Taiwan issue remains a hot one. But the ongoing purge in the military does not appear to be over. As such, we’re not likely to see China move on Taiwan this year, unless Xi feels pushed into it. More people will be investigated, leading to some instability within the military, and that’s not an environment for launching an attack. That’s good for continued movement of commodities. That said, President Xi now holds unprecedented power over the military, since no can ever directly challenge him now.

President Trump’s team negotiated a number of trade deals in 2025, with most of them containing a China element to them. One of Trump’s objectives in the negotiations was to use the trade deals as another tool to further contain China. As such, it upset him when Canadian Prime Minister Mark Carney traveled to Beijing this month to negotiate a trade deal with China, while also making comments about how “middle powers” must accept that the rules-based global order was over and how they must act together to avoid being victimized by American hegemony. Trump seemed okay with a Canadian – Chinese trade deal until that comment was made. As such, President Trump warned against Chinese abuse of Canada, and against it using Canada to bypass U.S. sanctions. He also threatened 100% tariffs on Canadian goods if Canada proceeds with completing a trade deal with China. Trump has also dismissed talk of the U.S.M.C.A. that is up for renegotiation in July as “irrelevant.” This does risk commodity trade between Canada and the United States, and thus it will need to be monitored.

U.S. brokered peace talks between Russia and Ukraine broke off without an agreement over the weekend. Russia continued to hammer Ukraine with drone attacks over the weekend, leaving millions without power under bitter cold temperature conditions. The attacks on Ukraine’s infrastructure continue to hamper Ukrainian commodity exports, with volumes starting to decline. Ukraine’s attacks on Russia’s shadow fleet create a broader risk toward commodity movement through the Black Sea Region. I will be surprised if there is peace in the region any time soon. President Putin doesn’t seem to want it, in my opinion, and that’s going to leave commodity trade in the region at risk as the attacks between the two sides continue to escalate. The talks are expected to resume again this weekend.

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Perspective: Morning Commentary for August 4

August 4 – The benchmark Dow Jones Industrial Average surged into the close yesterday to finish almost 700 points higher, at a record close of 53,178 points – easily clearing the previous top from almost a month ago. The S&P 500 is on the brink of its own record as well, while the NASDAQ index is short of June highs but working on a strong three-session rally. All three are pointing to positive openings today. Palantir (a U.S. software company) reported better-than-expected earnings yesterday afternoon post-close to boost the tech sector, though a host of other firms reported strong earnings as well. The ten-year note continues to retreat from Friday’s high, now at 4.67%, with the dollar on the high side of level-par, while the VIX index now under 16 shows reduced volatility.

Matt ZellerTue, 04 Aug 2026, 12:43

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Perspective: Morning Commentary for August 3

August 3 – Equities futures are pointing higher to open the week and month, still in range of recent record highs and flush with optimism that the U.S. and others will start to negotiate with Iran over the Strait of Hormuz. A busy week is on tap with earnings reports and jobs data, among other economic releases. Crude oil is down over $5 per barrel and nearing in on three-week lows. The dollar is only slightly lower this morning but at its own month-and-a half low, while the U.S. ten-year note is also slightly on the low side at 4.68. The VIX index is rebounding a bit today after a sharp slide into the end of last week, just above 16.

Matt ZellerMon, 03 Aug 2026, 12:45

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Perspective: Mid-Day Commentary for July 31

July 31 – Stocks are clinging to modest gains at midday, with largely better than expected U.S. economic data today providing some optimism to end the week. The VIX briefly spiked to 18.7 earlier in the session but has since settled back to 17.15 at midday. The dollar has given back some of its gains on the day, now only modestly in the green, up roughly 0.1% to trade near 100.06 at the time of writing. Treasury action has been mixed thus far today, but yields remain notably elevated, with 30-year yields trading just below their 19-year high at 5.267%, 10-year yields just off their one-and-a-half-year high at 4.74%, and 2-year yields right at 4.30%. Crude oil remains quietly higher, with nearby WTI up 0.9% on the day near $84.70 and nearby Brent up 0.7% to trade near $87.40. The grains and oilseeds are widely lower at midday, with the wheat complex leading the way down, while the livestock sector is largely in the green.

Mike CastleFri, 31 Jul 2026, 16:33

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