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Morning Rage 10.3.2012

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Metals are all gaining before the market opens. Gold futures are up two and three quarters, silver even, and platinum up a point and a third. Corn is down almost six points, but historically, October is a strong month for corn and soybeans. Soybeans start the morning even. 

Family Dollar Store will be announcing its quarterly earnings this monring. The stsock is already up a dollar-eighty in pre-market trading at $67.56. Although FDO has been missing earnings, the company has experiencing high growth in floor space by building new stores. 

The EIA Petroleum Status Report, which determies the price for petrolium products and reflects the supply and demand, will be released at 10:30am EST. ADP emoployment report that came out this morning beat estimates by 22,000 which could explain the push higher for futures this morning.

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September Seasonal Commodity Statistics

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Copper prices start to fall as the construction season ends and typically remain on a downtrend through December. Silver on the other hand typically starts to rally in September as demand rises. Jewelers start to buy silver in preparation for the holiday season. Also, farmers in India are known to buy precious metals after their harvest which ends through september.

This year Soybeans and grains are very strong due to drought conditions across large parts of the United States. Historically, soybeans are in a weak period during September, reaching their seasonal lows in October when the harvest is over. Corn is typically in a downtrend, although a frost scare can cause price spikes.

Meat prices, such as live cattle tend to rise as the demand for cattle rises in the Fall. Typically people eat more meat as temperatures cool off. Government programs such as school lunches also increase demand as school is back in session.

In the past 12 years, the Euro has rallied 11 times from Labor Day through the end of the month. I am not sure if this year will go with the historical trend, however a Euro rally before the election could be expected. European uncertainties may become more apparent in the next few months during the U.S. election season.

David Cornes holds a degree in economics from the University of Montana.

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