Grains and Oilseeds: July corn closed at $5.79 ½ per bushel, down 22c on expectation of larger crops overseas would reduce demand for U.S. crops. Stay out for now. July wheat closed at $6.09 ½ per bushel, down 14c on continued concern of sufficient crops and supplies. However any further selling in wheat could spur shortcovering and new buying should weather become a factor. We prefer the sidelines. July soybeans closed at $13.76 per bushel, down 10c on spreading against new crop November, which gained 5 1/4c to close at $13.14 per bushel. Dry weather expected to affect Brazil, a major soybean producer and the U.S. growing areas. We favor the long side of soybeans but only through the purchase of call options
Meats: August cattle closed at $1.1665 per pound, down 37.50 points on continued long liquidation after trading as high as $1.22 in late May and then $1.20 in early June. Concern that business will decline early this week prompted the long liquidation. We like cattle from here but with stops. July hogs closed at 91.20c per pound on profittaking after recent strength but technically hogs remain bullish. Reduction in kills has prompted packers to raise prices and we could see further buying once the slight correction is out of the way. We have turned bullish for hogs but only through the purchase of calls.
Coffee, Cocoa and Sugar: July coffee closed at $1.50 per pound, up 80 points after trading as high as $1.5120 on speculative buying and shortcovering after recent declines. Concern that the Greek election may have an effect on commodity prices and recent financial problems with Greece, Spain and Italy and prompted heavy selling. We could see continue shortcovering and new interest however at current prices. Buying calls would be our only suggestion for now. July cocoa closed at $2,225 per tonne down $32 on long liquidation after rallying from the $2,025 low in early June. We remain cautious and would take another look after the Greek election results and probably early Monday after the "smoke" from the election results clears. Otherwise we would look to buy puts on cocoa.
Cotton: July cotton closed at 79.98c per pound, up 1.89c on continued shortcovering after the recent selloff took price to below 67c per pound. We have liked cotton for some time but were stopped out early in the decline. We now would look to buy calls once again.