Factories Crank, Bonds Tank
Factory orders for the month of June posted their largest
monthly gain in over seven years. The rise shows the manufacturing sector
remains healthy, growing and potentially inflationary despite a recent flurry of
data depicting an economic slowdown. Traders are waiting for the employment
report slated for release Friday for additional information on whether low
joblessness levels might be pressing wages higher and adding to inflation.
Treasury futures are falling after spiking Wednesday.
September T-bonds
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PowerRating) are trading lower and are making good on a Turtle Soup Plus One
Sell setup on the prospect that the Fed may raise short-term interest rates
at its Aug. 22 meeting. Sept. T-bonds are currently trading 16/32 lower at 97
7/32.
Energies initially jumped higher, erasing some of the 5%
losses sustained Wednesday, but are selling off on word from the Saudi Oil
Minister that the largest OPEC member would raise production only after
consulting other cartel members. Crude oil, unleaded gasoline and heating oil
are brushing off Thursday’s statements and focusing instead on comments made by Oil Minister
Ali al-Naimi on Monday that Saudi Arabia would raise production unilaterally
until a barrel of OPEC crude fell to approximately $25.
Favorable weather and growing conditions continue to pressure
grains. Corn, wheat, soybeans and bean oil are filling out the
Implosion-5 List and
November soybeans are taking the biggest hit and trading right at their one-year
low.
Pork bellies have risen nearly their daily limit (3.000)
after a larger-than-expected poundage of meat moved out of Chicago Mercantile
Exchange-approved warehouses. Lean hogs are also rallying on the news.