November soybeans were trading down 6 cents near 7:30 cst this morning. China soybean futures were down slightly overnight and Malaysia palm oil futures were down 2.2% to push to a near 3-week low. Share prices in China were mixed to weaker despite a recovery in Chinese home price readings. Apparently some investors saw positive economic data in China, as a development that could derail additional stimulus efforts in China. European shares were slightly higher as decent earnings news provided a distraction from recent slowing fears. European markets were able to spin the US Fed meeting into a slight positive, as the talk was that the US Fed didn't rule out easing action in the future. However, US stocks have started out weaker today as if the trade expects to be confronted with renewed slowing fears through the US housing Permits and starts reports. It also seems as if the US Fed Beige Book will provide further evidence of slowing in the early afternoon trade today. The market could not hold new all-time highs yesterday and closed unchanged on the session. Ideas that the market is in a short-term overbought condition and hopes that the weather pattern could shift soon helped to pressure. Rain is expected across the far northern and eastern corn belt region over the near-term but trace to 3/4 of an inch will not help the Midwest avoid further spread of drought for the next few weeks given the above normal temperatures outlook. Eastern South Dakota received some rain overnight which should move into Minnesota today. This is badly needed as South Dakota has been dry for the past week and had to endure temperatures in the 100's on Monday. Traders remain concerned with the lack of a shift in the warm and dry trend into early August with some forecasters expecting the high pressure ridge over the Midwest to re-form in early August pushing temps back up near 100. Rains in the southeast and delta should be beneficial to soybean growth. Blistering temperatures, mixed with terrible topsoil conditions will continue to stress soybeans west of the Mississippi River. Many traders now see yield slipping to near 39 bu/acre from 40.5 by the USDA in the July outlook. Stressful conditions for pod setting in the next three weeks could easily drive yield potential even lower. With a 39 yield, ending stocks pencil out at 22 million bushels and most traders see pipeline minimum supply near 110-130 million bushels. The USDA assumes demand this season will be 3.105 billion bushels which is down 11 million from last year, 175 million from two years ago and down 256 million from three years ago. Traders believe this would be easier to absorb if South America supply was adequate but it is not. In the world supply/demand update, total foreign production for the 2011/12 season was down 22 million tonnes from last year which is 807 million bushels. Israel is tendering for 25,000 tonnes of optional origin meal. Egypt bought 12,000 tonnes of optional origin soybean oil and 35,500 tonnes of sunoil.