U.S. job market booms
On Friday, the U.S. Bureau of Labor Statistics released its monthly jobs report, which showed an economy that continues to rocket higher. There were 224,000 new jobs added in June, far better than May’s dud of a report that showed only 72,000 new jobs.
While this was good news, it also means that the Federal Reserve is less likely to give the economy a shot in the arm with lower interest rates. As a result, stock markets fell lower following the report, with September S&P 500 stock index futures trading near 2990 on Friday.
Alongside the job growth, U.S. wages climbed by only .2%, a signal that the Federal Reserve could have leeway to lower interest rates without fear of inflation if they decide that economic stimulus is needed in coming months.
China talks stall
The newest round of trade talks between the U.S. and China last weekend proved to be largely fruitless, with little by way of new commitments from either side. The ongoing trade war has seemingly settled into a stalemate, with no new measures being levied but little progress made to resolve it.
China made minor overtures toward buying some U.S. agricultural products as a sign of good faith, but markets barely registered the offer. December corn finished the week up 10 cents per bushel at $4.40 on Friday, while November soybeans fell to a two-week low beneath $9 per bushel. August hog prices finished near unchanged at 77 cents per pound, despite more news of Chinese hog losses to the African Swine Fever.
Gasoline market supercharged
Drivers hitting the road this week will likely notice higher fuel prices, as gasoline futures are sitting near a six-week high. Prices are rising after a major refinery in Philadelphia exploded on June 21, likely leading to its permanent closure. Additionally, global oil prices continue to remain elevated due to ongoing tensions with Iran.
As of midday Friday, August gasoline futures (which represent the price without taxes, transportation or other costs included), stood near $1.93 per gallon, while August crude oil fetched $57.40 per barrel.
Opinions are solely the writers’. Walt and Alex Breitinger are commodity futures brokers with Paragon Investments in Silver Lake, Kansas.