Sterling Market Commentary for Wednesday June 5th, 2013
A Look at the Market Since Our Last Update: The overall market pulled back moderately on Tuesday in a relatively broad based move that saw the majority of the sector indices I follow move lower on the day. Interest rates continued to move higher as well. In the commodities markets, Oil was lower by $0.14 to $93.31 per barrel, and Gold was lower by $14.70 to $1,397.20 per ounce. In the grain markets, Wheat was higher by $0.002 to $7.092 per bushel, and Corn was higher by $0.046 to $6.604 per bushel, while Soybeans were lower by $0.036 to $15.286 per bushel.
A Few Thoughts on the Upcoming Market: In looking at the charts from yesterday’s market, what I found interesting was that it looks like the Dow Jones Transportation Average with its close yesterday of 6,257.29 it appears to have broken support at 6,281.24 This raises the possibility that the Dow Jones Transportation Average could continue to move lower and test its April lows of 5,909.86 on a closing basis.
A few thoughts on corn in the commodities markets. I recently returned from a trip to Iowa,where I grew up. My family farms in north Iowa and as a result, I get a pretty good early look at how the crop production is starting out. This year it has been raining far more than normal,? to the point where it has severely delayed the planting season. As a result, the farmers in northern Iowa where unable to finish planting corn before it became too late for it to properly mature by harvest. In short, not as many acres have been planted with corn as were planned. As a result of this, the farmers in north Iowa are going to be forced to plant soybeans on that acreage. So basically we are looking at a situation where there is a very good possibility that there will be more soybeans hitting the market in the fall, and less corn than originally expected. Something to think about.
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