Perspective: Morning Commentary for April 10

By: Arlan Suderman, Chief Commodities Economist

Mon, 10 Apr 2023, 13:29

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 10 – Stock futures are generally weaker this morning following Friday’s solid jobs report that swung the pendulum of expectations back to expectations that the Federal Reserve will raise its benchmark rate once again at its May meeting. Traders are also keeping their eyes on growing geopolitical risks with China following a weekend of live-fire drills surrounding Taiwan. Yet, the VIX is still trading below 20, reflecting relative calm on Wall Street. The dollar index is trading near 102.6, as it shows strength once again with rising interest rates. Yields on 10-year Treasuries are trading near 3.39%, while yields on 2-year Treasuries are trading near 3.99%. Crude oil prices are modestly lower at this hour, while the grain and oilseed markets traded mixed to firm overnight.

The Bureau of Labor Statistics released its monthly jobs report on Friday, which was a bit unusual for a holiday release, especially at a time when the market was hyper-sensitive to employment data. There were no big surprises in the report, fortunately, but it still had significance. The report indicated that the economy created 236K jobs in March, which is very close to the 240K expected by analysts, although down from the 326K created in February, which was an upward revision from 311K. The unemployment rate ticked lower to 3.5%, when it was expected to remain unchanged at 3.6%. The labor participation rate ticked higher to 62.6%. Average hourly earnings rose 0.3% month-on-month as expected, which is up from 0.2% the previous month. However, average hourly earnings are “only” up 4.2% year-on-year, below the 4.3% expected and down from 4.6% the previous month. Keep in mind that the year-on-year numbers are comparing with a month last year when wages jumped 0.6% on the month, so they had an elevated base. The average workweek slipped lower to 34.4 hours.

Wall Street sees Friday’s report as consistent with the data that we’d been seeing last week. None of it by itself is enough to justify a pivot by the Federal Reserve. Rather, the data argues for the Fed to stay the course. This is the final jobs report that will be released ahead of the Fed’s next meeting, although there are many other reports that will be released between now and then that can influence the Fed. That includes the consumer price index and producer price index this week, along with retail sales data. Keep in mind that Fed Chair Jerome Powell has stated more than once that they do not want to make the mistake made by the central bank in 1980, lowering rates too quickly that then requires more drastic action to get things under control again. That is their bias. We are very early in the process of layoffs rising, hiring intentions starting to slow and jobless claims starting to rise. As such, the market is pricing in 69% odds of another 25-basis point rate hike this morning, and that adds to the negativity on Wall Street amid increased expectations of a recession.

China conducted live-fire military drills around Taiwan over the past three days, but reports this morning indicate that those drills have concluded. The drills included penetration of Taiwan’s territorial waters and simulated precision attacks on strategic points of interest in Taiwan in response to Taiwan’s president meeting with the U.S. Speaker of the House in California on Wednesday of last week. However, Chinese leadership waited until after French President Macron departed his three-day visit of China before engaging in the military drills. Simultaneously, the U.S. Navy sent a message of its own to China, by sending a destroyer close to a contested island a thousand miles away in the South China Sea. The contested island is a man-made island on Mischief Reef in the Spratly islands, where China placed a military installation. The United States Navy stayed just outside the internationally recognized 12-mile boundary waters, while claiming its right to move through the South China Sea international waters. China claims, “indisputable sovereignty over the South China Sea islands and their nearby waters.” No direct conflict is expected between China, Taiwan, and the United States near-term, but the greater risk with so much activity in close proximity amid the recent threats would be an “accidental” beginning to a conflict that could send the markets into turmoil – especially the commodity markets.

The dramatic Midwest warmup starts this week, with active fieldwork expected across the bulk of the Midwest. The exception will be the snowpack areas of the northwestern Ag Belt, where flooding risks will be increasing. Some forecasts show an improved longer-range outlook for spring planting, while others call for returning freeze and rain risks. We’re in the time of year when U.S. weather takes on greater importance for grain and oilseed traders. USDA will update its monthly WASDE crop report tomorrow. It’s expected to be a relatively quiet report, although we’ll likely see more cuts to Argentine corn and soybean crops, while Brazil’s crops could get bigger.

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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

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Perspective: Mid-Day Commentary for August 6

August 6 – Stocks remain quietly mixed at midday as both the S&P 500 and Dow Jones remain just below their fresh all-time highs put in yesterday. This is allowing the VIX to cool to a four-week low below the 15.4 mark, reflecting the collective sigh of relief in the market amid largely better than expected U.S. economic data today. The dollar remains quietly in the green in its relatively tight range this week, trading at 99.9 at the time of writing. Treasuries remain elevated but have cooled from their recent peaks, with 30-year yields trading at 5.189%, 10-year yields trading at 4.647%, and 2-year yields trading at 4.229% at midday. Crude oil also remains quietly in the green, with nearby WTI up 2.3% on the day trading near $76.80 and nearby Brent up 2.4% on the day trading near $81.40. The ags remain mixed, with the wheat complex now squarely in the red while corn and soybeans cling to small gains, and the livestock complex largely pushes lower.

Mike CastleThu, 06 Aug 2026, 15:18

Grains & Oilseeds

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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