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Financials: As of this writing (6:30am) March Bonds are 4 lower overnight at 168’24 down 5 points for the week, 10 Year Notes down 2 at 136’29 up 4 for the week and 5 Year Notes down 1 overnight. And unchanged for the week. Yields are slightly lower the week with the 2yr. at 0.13%’, 5 yr. at 0.45, 10 year at 1.09% and the 30 yr. 1.84%. Other than a new President nothing much has changed in the last five trading sessions. The Covid pandemic is still growing as getting the vaccine into arms suffers from logistical problems. Proposed stimuli of 1.9 trillion might have problems passing in present form but the market may have already prices this in. Of note: the 2-10 year spread sits at 1.72% premium the 10 year. It wasn’t all that long ago that the spread was at even money.
Grains: March Corn is 8’0 higher at 530’0 down 4’0 for the week, Beans up 14’0 overnight at 1383’6 down 39’0 for the week and Wheat up 5’2 at 673’0 down 12’0 for the week. Profit taking was responsible for a good sized break which saw prices I of 523’0 in Corn and 1353’0 in Beans. Technically the bull market is still in tact and I will be a buyer on sharp breaks.
Cattle: April Live Cattle closed yesterday at 118.875 down 47 and March Feeder Cattle up 72 at 137.525. Some relief from high feed grain prices helped rally these markets off of recent lows. I still like June and August LC on breaks, but continue to be bit negative on nearby contracts as weights and marketings continue to increase and demand is still under pressure as many areas remain in lockdown status re. the pandemic.
Silver: March Silver is currently 20 cents higher at 25.97 up 69 cents for the week. I am ready to reenter this market from the long side on a one dollar break.
S&P: March S&P’s are 9.00 higher at 3854.00. The market appears to be rallying on the euphoria of a new administration while unemployment surges and the gov’t issues more debt to cover stimuli packages. I’m not saying this is a bad thing, as incoming Treasury Secretary has been quoted as saying with interest rates being so low it’s time to go big. I’m just the messenger. Look for a downside correction to the 3745.00 area.
Currencies: The March Euro is 56 higher at 1.2177, the Yen 4lower at 0.9660,thePound 72 higher at 1.3728 and the Dollar Index 36 lower at 90.10. I remain negative the dollar but feel this market has too much company so to speak and is subject to short covering rallies.
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