Financial news on Tuesday morning lacked a dramatic talking point until the program's second segment began. Gold and silver continued to climb, with gold posting its highest close on record Monday afternoon and silver reaching new highs nearly daily. February gold closed Monday at $4,614.70, while March silver opened the week at a high of $86.34.
Steve Sedgewick of CNBC's Squawk Box Europe noted the metals' rise, linking it to safe-haven buying over concerns about the US Federal Reserve's independence following weekend developments. He pointed out that equity markets also hit new highs, suggesting no broader market concern. This raises questions about whether metals or equities are correct, or if the safe-haven explanation is flawed.
In the grains sector, corn extended Monday's decline overnight into Tuesday morning. March corn dropped as much as 2.75 cents below $4.20 before recovering slightly to a 1.0-cent loss, with 43,000 contracts traded. The market's fundamentals remain unchanged, with US supplies outpacing demand in Q1 of the 2025-26 marketing year despite strong exports. The May-July futures spread showed a less bullish commercial outlook compared to last year.
Soybeans also fell early Tuesday. The second segment of the financial news program highlighted a social media post from the US president decreeing a 25% tariff on any country doing business with Iran. This raised immediate questions about whether tariffs on imports from China, the world's largest soybean buyer, would increase by another 25%. As of January 1, China held 5.7 mmt of soybeans, with shipments at only 1.2 mmt, down from 16.7 mmt last year. The USDA's latest export demand estimate was 1.575 bb, below last month's but above the current pace.
Wheat markets moved lower overnight after escaping most of Monday's post-report pressure. March HRW dropped as much as 5.5 cents on 3,200 contracts, sitting 3.5 cents lower at the time of reporting. Funds recently moved to a net-long futures position of 1,630 contracts, increasing vulnerability to long liquidation. The market remains bearish, with the National HRW Index near $4.57 Monday night, below last year's low. March SRW was down 1.0 cent pre-dawn Tuesday, unchanged from last Tuesday's settlement.