DTN Early Word Opening Livestock 10/05 07:07
Early Buying Expected in Cattle, Hogs
Live cattle 30 to 40 higher, feeder cattle 25 to 50 higher, and lean hogs 10
to 30 higher.
By Darin Newsom
DTN Senior Analyst
The Dow Jones Industrial Average closed 200.36 points higher Friday at
16,472.37. The NASDAQ Composite was up 80.69 points at 4,707.77. DJIA futures
were 55 points higher overnight. Asian markets were higher with the Nikkei up
280.36 points at 18,005.46 and China's Shanghai Composite was up 14.64 points.
European markets were also higher. The U.S. dollar index was down 0.352 at
95.478. Crude oil was $0.60 higher at $46.14 while Brent crude was $0.64 higher
at $48.77. December gold was $4.20 lower at $1,132.40. Malaysian palm oil
futures were higher. December corn was 1 cent higher, December soybean meal was
$1.60 higher, and December Chicago wheat was 3 cents higher.
The daily price chart for the December live cattle contract shows an
interesting pattern the last couple of weeks. A strong Friday rally is followed
by continued light buying Monday, only to see the contract collapse to a new
low through mid-week. Given buying seen last Thursday and Friday that rallied
the contract off its new low of $128.10 it would not be surprising to see light
follow-through interest when this week gets under way. However, the major
(long-term) trend remains down with technical support pegged near $126.50 on
the market's monthly chart. Friday's CFTC Commitments of Traders report showed
noncommercial interests reducing their net-short futures position through
Tuesday, September 29. However last week's spread activity, most notably the
strength of the February contract against the December, reflected an
increasingly bearish view of longer-term market fundamentals. This is what
could ultimately lead to renewed pressure again this week.
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