Perspective: Mid-Day Commentary for May 8

By: Mike Castle, Market Intelligence - Fertilizer Analyst

Fri, 08 May 2026, 17:01

May 8 – Fighting in the Middle East continues, but so does the stock rally as the tech-heavy Nasdaq continues to lead the pack higher as it presses deeper into record high territory, surpassing the 29,000 mark for the first time in history only three days after surpassing 28,000 for the first time. The S&P 500 is trading at a fresh all-time high at midday as well, while the Dow brings up the rear, clinging to narrow gains at the time of writing. The VIX has risen throughout the session but remains muted, hovering right around the 17.2 level. The dollar remains in the red at midday, trading just above 97.9 at the time of writing. Treasuries are slightly lower too, with 10-year yields trading above 4.36% and 2-year yields trading above 3.89%. Crude oil has worked its way higher from morning lows amid the ongoing escalations between the U.S./Iran and Israel/Hezbollah, with nearby WTI breaking back above $96 and nearby Brent trading around $101.50 at the time of writing. The broader commodity sector appears to be catching a bit of a bid as traders brace for two days of market closure and potential escalatory headlines over the weekend, with the grains and oilseeds now largely in the green at midday, led higher by soybeans, though the livestock sector has turned red, with feeder cattle futures seeing the sharpest selloff. Next week will be a pivotal one for the ag sector, with USDA giving their first look at ‘26/’27 balance sheets on Tuesday’s tone-setting May WASDE, while the Kansas wheat tour will also be taking place, and President Trump travels to China to meet with President Xi to cap things off.

Total assets in the Fed’s balance sheet rose to $6.710T in the week ending May 6^th, up 0.14% week-over-week and representing the highest level seen in almost exactly one year. The week prior saw the first decline in nine weeks, but the trend in 2026 continues to favor pressing higher, with this week’s reading marking a 2.66% (or $173.7B) rise from the bottom made back in early December. There’s still been no official announcement, but expectations are to see a confirmation vote for Fed Chair nominee Kevin Warsh take place next week ahead of Jerome Powell’s term expiring Friday (5/15). With a changing of guard at the Fed incoming, look for this metric, among others, to make their way more to the forefront.

U.S. consumer sentiment dropped further into May, with University of Michigan’s headline Consumer Sentiment dropping to a fresh all-time low of 48.2, down from April’s final 49.8 and missing expectations of a more modest decline to 49.5. The sharp drop in the headline reading was driven by a hard downturn in the Current Economic Conditions subindex, falling from April’s final 52.5 down to a record low of 47.8 in the preliminary May reading, well below the forecasted 52.0. As could be expected, the top reason cited for this pessimism was surging prices at the pump. With national average retail gasoline prices rising to their highest since 2022 at $4.45/gallon this week, it’s not much of a surprise. However, the forward-looking Consumer Expectations subindex rebounded slightly from 48.1 in April to sit at 48.5 in May, slightly above market expectations.

Consumer inflation expectations unexpectedly fell in today’s data, however, with one-year expectations coming in at 4.3% after reaching a seven-month high of 4.5% in April while five-year expectations fell to 3.4% from the six-month high of 3.5% seen in April. An optimist could point to a potential silver lining in this data, noting the ugly current conditions but improving expectations for the situation ahead. We’ll have two weeks for consumers to react to more back-and-forth headlines as well as fresh inflation data and likely higher fuel costs, so it will be interesting to see how these readings change into the final May reading, set to be released on Friday, May 22^nd.

While this week’s macro focus was on the labor market, where data largely came in sharply better than expected and provided renewed wind in the proverbial sails of the risk assets, next week will be inflation’s turn to step back into the spotlight. The Reuters poll for next Tuesday’s headline April CPI report shows expectations for an uptick to a 3.7% yearly rise which, if realized, would represent a high not seen since September 2023. Similarly, headline PPI is seen surging to a 5.0% year-over-year increase, which would represent a high since January 2023. New Fed Chair Kevin Warsh will certainly have his work cut out for him as he inherits this, and we’re likely to see the inflation story remain front of mind through the remainder of 2026.

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Perspective: Morning Commentary for June 23

June 23 – The tech sector came under heavy pressure again overnight, as investors worry about AI once again in the ebb and flow of market sentiment on the topic. The selloff was strong enough to push the VIX back above 20 this morning, while the dollar index trades near 101.3 – a new 13-month high. Yields on 10-year Treasuries are trading near 4.49%, while yields on 2-year Treasuries are trading near 4.19%. WTI crude oil prices put in a new low for the move overnight, trading as low as $72.48 per barrel, although they’ve recovered roughly a dollar since, while Brent trades near $77 per barrel as oil flow through the Strait of Hormuz increases. Wheat prices were again under pressure overnight, while corn and soybean prices posted modest gains.

Arlan SudermanTue, 23 Jun 2026, 13:27

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Perspective: Morning Commentary for June 22

June 22 – Stock futures were generally steady to firmer to start the week, with investors viewing U.S. / Iran negotiations with cautious optimism. The VIX is trading near 17 this morning, while the dollar index remains strong near 101.0. Yields on 10-year Treasuries are trading near 4.50%, while yields on 2-year Treasuries traded at fresh 16-month highs near 4.23%, as the curve continues to flatten. WTI crude oil is trading near $75 per barrel this morning, while Brent trades near $78 per barrel. Wheat prices were modestly weaker this morning, while soybeans followed soybean oil higher. However, the stronger dollar provided headwinds for much of the complex this morning.

Arlan SudermanMon, 22 Jun 2026, 13:51

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China's US Soybean Pledge Faces a 10-Million-Ton Credibility Test

China committed to buy 25 million metric tons of US soybeans in the 2026-27 marketing year, but official forecasts and market skepticism suggest the actual figure could be 10 million tons lower. The gap between political commitment and commercial follow-through is now shaping how grain traders read every incoming export sale.

Editorial TeamFri, 19 Jun 2026, 08:53

Grains & Oilseeds

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