Perspective: Morning Commentary October 1

By: Arlan Suderman, Chief Commodities Economist

Wed, 01 Oct 2025, 13:35

October 1 – The government is in a partial shutdown after Democrats blocked a vote on a funding measure in the Senate. That means that many government reports that provide data to the markets will not be released. This leaves the markets drifting in a bit of a fog going forward. Stock futures were weaker overnight, while the VIX firmed to trade either side of 17, and the dollar traded lower near 97.6. Yields on 10-year Treasuries fell to test support near 4.10% following this morning’s private sector jobs data release, while yields on 2-year Treasuries traded lower near 3.54%. Crude oil prices are again weaker as they test the bottom of this month’s trading range just below $62 per barrel, while the grain and oilseed sector remained weak after yesterday’s set of bearish reports from the USDA.

The government went into shutdown mode at midnight last night. That means that nonessential workers did not show up for work this morning, and many services to which we’ve become accustomed will not be available. Furloughed employees historically have been paid, but not until after the funding bill has been passed and signed. In this case, the House of Representatives passed the funding mechanism, passing it on to the Senate, but Senate rules require 60 votes to move a measure to the floor for discussion and an up or down vote. Republicans only have 53 members in the Senate, so they needed at least 7 Democrats to cross party lines just to get the funding bill to the floor, and that didn’t happen. Most federal assistance programs will continue, at least unless the shutdown becomes long in nature and funds run out. Many government reports, such as tomorrow’s scheduled weekly jobless claims data and Friday’s monthly jobs report, may be delayed, although we note that the Energy Information Administration has a post on its site that it will continue to release reports as long as it can during this shutdown. We still do not have word on whether the Bureau of Labor Statistics, USDA, or others will release reports. Services that are expected to continue include mail delivery, and mandatory spending programs such as Social Security, Medicare, and Veterans benefits. National security and law enforcement is also expected to continue.

The private sector lost 32K jobs in September, according to ADP, missing analyst expectations that we would see modest growth of 50K jobs. Furthermore, the August numbers were revised to negative 3K as well, down from the 54K jobs created in the original report last month. This job contraction in the private sector was viewed by traders as evidence that the Fed should accelerate its rate cut cycle, leading to a notable decline in Treasury yields as the market began pricing in more aggressive rate cuts. In fact, the CME FedWatch put 90% odds of two more rate hikes by December this morning, Ironically, we continue to see evidence of a resilient economy, but companies simply are not refilling open positions due to the uncertainty still in the economy. The soft jobs market is less a factor of mass layoffs, and more of a situation where companies simply are not refilling openings until they know more about where we’re going with the tariff war. M2 money supply continues to be at or near record high levels, and many indicators suggest that the consumer is spending for entertainment, but not making big ticket purchases due to the above-mentioned uncertainty – although we have seen a bump in housing purchases.

USDA released two reports yesterday – both of them with bearish implications. USDA’s small grains summary report provided final 2025 production estimates for various small grains. Most notable was the wheat production report that placed final all-wheat production at 1.985 billion bushels, up 58 million bushels from its August estimate, and up 60 million bushels from the average trade guess. The larger production was the product of a modest yield increase, but a more significant increase in harvested acreage, bringing up memories of USDA’s surprise increase in corn acres and drop in soybean acres. Winter wheat harvested acres rose by 773K acres, although that was partially offset by a decrease of 80K harvested acres for spring wheat. September 1 wheat stocks came in at 2.120 billion bushels, up from 1.992 billion bushels the previous year, and 77 million bushels above the average trade guess. The unanticipated increase in production accounted for the bulk of the surprise rise in stocks. The job of the wheat market is to find a price that will get rid of the extra bushels. As such, prices fell to new lows overnight, which should keep export demand strong.

September 1 corn stocks came in at 1.532 billion bushels, making that the beginning stocks for the 2025-26 marketing year. Unfortunately, that was 195 million bushels above the average trade estimate. USDA did increase the size of last year’s crop by 25 million bushels. Putting the past several stocks reports together would suggest that USDA understated the size of last year’s crop by closer to 200 million bushels, but it didn’t want to make that admission. As such, it will likely lower feed usage for last year, but that means it must do the same for this year too. Fortunately for USDA, it looks like this year’s crop will be shrinking, giving USDA the opportunity to cut feed use. The soybean stocks report was mostly neutral, although soybeans continue to face a demand issue.

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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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