Financials: Bonds are currently 1'12 higher at 139'10 and the 10 Yr. Note 18 higher at 130'29, both on new recent highs as the market flees to safety because of renewed fears of a Global slowdown and the vulnerability of European banks. This morning CPI (consumer price index) showed an increase of 0.5% vs. expectations of 0.3%. Ex-food and energy was in line with expectations up 0.2%. Initial jobless claims were up 9,000 vs. estimates of up 5,000. Other reports out later this morning: Existing home sales, Philadelphia Fed Survey and Leading Economic Indicators. I remain on sidelines because I believe rates are getting too low (will the 10 Yr. note see 2.0%?).
Grains: Yesterday beans closed 16 cents higher, Corn 2 lower and Wheat 2 lower. Over night Beans were 11 lower, Corn 8 lower and Wheat 9 lower. I expect these markets to follow the overall tenor of other Global markets this morning especially equities. We remain long call spreads in Dec. Corn.
Cattle: Yesterday Oct. Live cattle closed 270 lower at 117.40 and Oct. Feeder Cattle 250 lower at 136.35. Both of these markets are about 75 lower as of this writing. If you remain short either take profits or use a protective buy stop at 118.00 in Oct. LC and 137.25 in Oct. FC. If the market trades 100+ lower, lower your buy stops accordingly.
Silver: Sept. Silver is currently 32 higher at 40.67. We continue to hold a small long position aware that we are approaching resistance above the 41.00 level. We were stopped out of a recent short position in Gold as it made a new contract high. I still believe that Gold shows all the symptoms of a speculative bubble.
S&P's: Sept. S&P's are currently 31.00 lower at 1159.00. Fears of a Global slowdown and "double dip recession" have pressured the market this morning. Over night, support of 1175.00 was penetrated putting the next level of support in the 1153.00 area and resistance is now 1184.00. I still believe the over all trend is down but feel the market can be short term traded on breaks for the next couple of sessions.
Currencies: As of this writing the Sept. Euro is 101 lower at 1.4345, the Swiss 63
lower at 1.2630, the Yen 15 lower at 1.3064 and the Pound 55 lower at 1.6507. I remain
on the sidelines.
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