(RJO GRAINS) Ag market sell-off continues with soy leading the way down on heels of disappointed weekly export sales, approach of Feb crop report that could trim US soy exports (sales off 6.8 mmt vs. YA), confirmation that arrival of Arg rains late next week still on track and increase in US soy processor bean ownership on 40 cent advance in SH since mid-Jan. Wheat responding to adage that bull markets must be fed daily with little in the way of new positive news—especially given disappointing weekly wheat export sales.
(JPM on overnight) The big focus is on the “micro” as investors digest the busiest 24 hours of the CQ4 earnings season. More than $4T worth of tech market cap will report earnings over the 24 hours started Wed night while a slew of companies reported earnings in Europe this morning. On the whole CQ4 earnings remain very strong although there certainly some areas of controversy Wed night (FB/MSFT both were “fine” and while each saw initial after-hours weakness, they rebounded and closed the Wed night session.
WASHINGTON-The Federal Reserve held short-term interest rates steady Wednesday and said it will continue along its path of gradual increases aimed at keeping the economy on track. The rate-setting Federal Open Market Committee, in a statement released after its policy meeting, offered nothing to dispel market expectations that it will deliver its next rate increase in March. Such a move would extend the central bank’s pattern, since December 2016, of announcing steps to remove economic stimulus at every other meeting. Fed officials are hoping to keep rates low enough to encourage inflation to firm up a bit without surging out of control, amid a tight labor market and solid economic growth.
(WSJ) TSY yields are rising for a variety of reasons, some “good” (better nominal growth), some neutral (tighter monetary policy in response to improved nominal growth), but also some “bad” ones, namely growing deficits and bond supply. Treasury borrowing needs could spike to $955B in the FY ended 9/30 (vs. $519B last FY) before rising further in the years
(Politico) Washington faces another shutdown battle – the odds of a long-term budget agreement being reached by 2/8 are nearly zero and while leaders are working on another multi-week CR, Republicans are experiencing some trouble gathering the votes needed for passage.
(Reuters) U.S. crude oil production in November surpassed 10 million barrels per day for the first time since 1970, and neared the all-time output record, the Energy Information Administration said in a monthly report on Wednesday. Oil output rose 384,000 barrels per day (bpd) in November from October to 10.038 million bpd, the agency said. The agency also increased its October estimate by 17,000 bpd to 9.654 million bpd, according to the report, known as the 914 production report.
(Reuters) Oil prices are unlikely to advance much higher than $70 a barrel in 2018, with the market caught between the opposing forces of OPEC-led production cuts and surging U.S. output, a Reuters poll showed on Wednesday. The survey of 34 economists and analysts forecast that Brent crude will average $62.37 a barrel in 2018, up from the $59.88 forecast in the previous monthly poll.