Wednesday stock market reversal seemed to depress commodities
Hog futures posted an impressive rebound Wednesday afternoon, but turned sharply lower again overnight. Afternoon reports of cash weakness across the Corn Belt may be weighing upon the market, but that would assume that the strong wholesale gains posted Tuesday and Wednesday had no supportive effect. We wonder if technical and/or seasonal factors played a role in the late drop. April hogs declined 0.85 cents to 82.10 cents/pound in the pre-dawn hours of Thursday morning, while June dove 0.82 cents to 91.52.
Cotton futures fell rather substantially Wednesday night. We suspect the equity market reversal suffered earlier in the day played a big role in the drop. The technical repercussions of the Wednesday afternoon cotton setback may also be translating into follow-through selling. That is, after seeming set to break out above trendline resistance drawn across its recent highs, nearby cotton futures now appear technically vulnerable. March cotton fell 0.58 cents to 81.70 cents/pound in early Thursday morning activity, while December dropped 0.62 cents to 83.65.