Natural Gas Surges As Heat Wave Rolls Through U.S.

U.S. 10-year yield prices look to continue moving up as
investors wager that the Fed will pause the rate hikes in August, opening the
door for rate cuts during the next year. With all signs pointing to a
slowing U.S. economy, investors expect the Fed to stop the rates and even cut
them, as U.S. economic policy shifts its attention away from containing
inflation. The war in the Middle East continues to weigh on investor
sentiment, as a full-scale global war would have tremendous effects on all
currencies and markets throughout the world. Bonds remained basically
unchanged on the day.

The Dollar remained unchanged today against the yen and euro
as Fed officials continued to debate whether or not the overnight lending fee
for banks will be raised during August’s Fed meeting. The BOJ and ECB both
are expected to raise rates this year, so a pause in the rate hikes would equate
to weakness in the dollar. If the U.S. economy is cooling fast enough to
warrant a pause, the yen and euro would both rally, especially if their
respective hikes followed through.

In the energies, natural gas rose 14%, the biggest percentage
gain this year, as temperatures across the United States continued to rise, with
no end in sight. The high temperatures increased the demand for the gas,
which is used to generate power and electricity. Crude oil also rose
today, up 1.6% to close at $74.40 a barrel. Tensions remain high in the
Middle East, with the threat of a full-scale war still present in investors’
minds.

The metals were mostly unchanged to close the day, except for
aluminum futures, which closed up 2.4%.

The softs also traded mostly unchanged. Cocoa beans
stood out, down 0.4%.

Grains traded mostly higher today. Corn was up 0.75%,
wheat was up 2.3% and soy was up 0.5%.

Meats traded mixed today, with potbellies falling 2.3% and
feeder cattle up fractionally.


Economic
News

Fed’s Yellen: Fed Rate Near Where It Should Be (full
story
).

A round of foreign economic reports were released
today.
Check them
here
.