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Outside markets dominate CBOT at mid-day

Agriculture.com Staff 11/05/2007 @ 9:50am

Big-time woes in the banking sector -- specifically regarding issues surrounding sub-prime credit and lending -- is weighing on the stock market this morning, and that weight has begun to hold down CBOT commodity prices this morning, according to market analyst Jason Ward of Northstar Commodity Investment Co.

"Citibank, the world's largest bank, wrote off $11 billion of bad debt due to bad loans that they had written," Ward said of this morning's trade. "This has brought more concern into the stock market here this morning, trading down 90 points here in early trade. This news has brought up the sub-prime credit concern again."

In addition to pressure on the energy sector -- where crude oil began the day trading $2 lower -- CBOT commodities are feeling the stress. After starting out 4-5 cents lower, corn has rallied to 1 cent lower, following a late-morning bump in crude oil, which settled at mid-day to 70 cents per barrel lower. December corn stands at $3.76 at mid-day.

A sharper flip has occurred in the soybean market. After starting the 5-6 cents lower, nearby futures have traded to 3 cents higher on the "turnaround in the energy sector," Ward says. Wheat prices, which started up for the day, are stable as of mid-day. December Chicago wheat started the day 6 cents higher and as of mid-day, traded at the same level.

Looking ahead through the day, Ward says outside factors will continue to be the story in Monday's trade. "There's nothing worrisome in the weather to speak of at the moment, so we are content to follow the outside sector," he said.

Big-time woes in the banking sector -- specifically regarding issues surrounding sub-prime credit and lending -- is weighing on the stock market this morning, and that weight has begun to hold down CBOT commodity prices this morning, according to market analyst Jason Ward of Northstar Commodity Investment Co.

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