Bears win big

The Oklahoman (Sunday) - - BUSINESS - Walt & Alex Bre­itinger www.paragon in­vest­ments.com Opin­ions are solely the writ­ers’. Walt and Alex Bre­itinger are com­mod­ity fu­tures bro­kers with Paragon In­vest­ments in Sil­ver Lake, Kansas. They can be reached at 800-411-3888 or www. parag­o­nin­vest­ments.co

A wild week on Wall Street leads this edi­tion of Fu­tures File, our weekly com­modi­ties wrap-up.

A wild week on Wall Street leads this edi­tion of Fu­tures File, our weekly com­modi­ties wrap-up.

Stock bears win big

U.S. stock mar­kets plunged, then surged, and then plunged again this week, in a wild whip­saw that left mar­ket watch­ers breath­less. The sell-off has largely been at­trib­uted to fears about the Fed­eral Re­serve rais­ing in­ter­est rates, a move that could hurt cor­po­ra­tions’ prof­its, but much of the trad­ing ac­tion was caused by com­pla­cency.

Af­ter nearly a decade of climb­ing mar­kets and two years with­out a cor­rec­tion, Wall Street traders made mas­sive bets that the mar­ket would con­tinue qui­etly climb­ing. When mar­kets turned volatile, many pan­icked and dumped stocks, ex­ac­er­bat­ing the panic sell­ing. An old trader’s adage is “a bull climbs up the stairs and a bear jumps out the win­dow,” a re­minder that slow climbs can be fol­lowed by rapid drops.

Some of the wildest moves hap­pened out­side of nor­mal mar­ket hours in New York, with the biggest drop oc­cur­ring Mon­day night in the fu­tures mar­kets, which trade al­most 24 hours per day. Rather than sell in­di­vid­ual stocks or pick apart a port­fo­lio, many in­vestors and traders pre­fer to sell fu­tures con­tracts that track an en­tire stock in­dex, like the NASDQ, S&P 500, or Dow Jones in­dus­trial av­er­age, mak­ing those mar­kets es­pe­cially pop­u­lar this week.

Corn prices sprout

Corn prices have been steadily climb­ing for the last three weeks, and qui­etly reached a six­month high on Thurs­day. Prices have been gain­ing on hopes for more U.S. corn ex­ports as our biggest com­peti­tor, Ar­gentina, strug­gles with poor weather.

Th­ese ex­pec­ta­tions were sup­ported by Thurs­day’s U.S. Depart­ment of Agri­cul­ture re­port, which cut the size of Ar­gentina’s crop by 7 per­cent and pro­jected stronger U.S. sales to for­eign buy­ers.

For U.S. farm­ers sit­ting on mas­sive stock­piles of un­sold corn from last fall, this rally over $3.60 per bushel has been wel­come news.

Gaso­line fu­tures drive lower

Gaso­line fu­tures have fallen for six straight trad­ing ses­sions, pulling the mar­ket near a two-month low. This break should be a wel­come re­lief for driv­ers who saw prices surge over two-year highs just a few weeks ago. With the re­cent 25-cent drop, gaso­line fu­tures, which rep­re­sent the cost of fuel with­out taxes or other ex­penses like trans­porta­tion, are trad­ing for $1.70, barely above the av­er­age price from 2017.

Gaso­line is be­ing pulled lower by record U.S. oil pro­duc­tion as new tech­nolo­gies, in­clud­ing frack­ing, have opened vast sup­plies that were once un­eco­nom­i­cal to drill for.

The in­creased sup­ply of crude oil is al­low­ing re­finer­ies to run near full-ca­pac­ity and has re­sulted in climb­ing stock­piles of gaso­line and diesel fuel.

[AP PHOTO]

Trader Gre­gory Rowe works on the floor of the New York Stock Ex­change on Mon­day, when the Dow Jones in­dus­trial av­er­age lost more than 1,000 points.

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