Daily Close | Forex, Metals, Oil, Agriculture May 05, 2021



China is buying a record amount of soybeans, as well as grains like corn and wheat. Various foodstuffs, like corn and soybeans, are also spiking. less Image Source: Unsplash Brazil is one of the biggest producers in the world of sugar, coffee, and corn. Conor Sen Yes, corn prices are at nine-year highs.


A weaker greenback also added to the strength as it makes dollar-denominated assets attractive for foreign investors, raising the appeal for commodities. This is because commodities are often viewed as a hedge against inflation and a weaker dollar.


Prices for a wide range of commodities from copper to oil to timber have been skyrocketing as the world’s largest economies recover from the pandemic. Commodities like lumber and copper, which are used to meet demand for housing, are rising at near parabolic rates. As a result, June-dated gold added $8.30, or 0.5%, to settle at $1,784.30 an ounce.


Much of the optimism surrounding the reopening of the U.S. and European economies, as well as U.S. crude inventories’ biggest weekly dip since January, ultimately faded. Oil prices snapped a two-day win streak on Wednesday, despite earlier shooting for its highest close in over two years. As a result, June-dated crude fell 6 cents, or 0.1%, to settle $65.63 per barrel. This complements the US Weekly Gasoline Import Forecast that is emailed and posted to Eikon each Tuesday.

United States

A: Not a thing There is a stimulus impact of holding down short term rates, but the Fed was already committed to holding rates to zero indefinitely anyway. Historically, the only thing that has stopped inflation is for the Fed to tighten monetary policy by either hiking interest rates or tapering its Quantitative Easing (QE) programs. During the last legitimate inflationary storm in the 1970s-1980s, the Fed was forced to be MUCH more aggressive with its tightening, raising interest rates from 4.5% to over 19%!
The list of companies are S&P 500 names with the largest declines projected, according to the average 12-month price target from Wall Street analysts. PayPal will report its first-quarter earnings amid a downturn in the Nasdaq 100, however, and traders will be watching to see how the stock behaves throughout the day. According to Fed Chair Jerome Powell the inflation we’re experiencing is “transitory” meaning it won’t last so the Fed doesn’t have to do anything.
The S&P 500 also logged a solid win, though the Nasdaq gave up earlier gains to register a modest loss. During the last inflationary scare in 2010-2011, the Fed allowed its QE 2 program to end. This may make ‘sense’ (to the gamblers) with respect to the mature large caps that largely populate the S&P500 and even the Nasdaq. The Fed doesn’t believe the U.S. is experiencing real inflation yet. Research from our team of in-house analysts has been quoted by The Wall Street Journal, Bloomberg, MarketWatch, USA Today, Kitco, Reuters, US News & World Report, CNBC, and more.
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