Thursday Closing Livestock Market Summary

GENERAL COMMENTS

Moderate trade volume was reported in most areas of feedlot country. Live sales in the South ranged from $117-$118, $1-$2 lower (mostly $118, $1 lower). Dressed biz in the North took placed around $188, $1-$2 lower than last week's weighted average basis Nebraska. According to the closing report, the national hog base is $0.30 lower ($83-$89.50, weighted average $86.68). Corn futures settled a penny-plus lower, pressured by the new seven-day forecast that seemed to promise plenty of rain for much of the Midwest. The stock market closed under pressured with the Dow off 158 points and the Nasdaq down 61.

LIVE CATTLE

Live contracts opened lower but successfully attracted renewed buying interest and short-covering as the session progressed. More specifically, spot August found help right where the doctor prescribed, nearly its 100-day moving average at $112.50. When the dust cleared at the end of the trading day, short-covering and tech-buying had pushed contracts 30 to 140 higher. Beef cut-outs: sharply lower, off $1.56 (select, $203.76) to $2.53 (choice, $220.05) with light to moderate demand and heavy offerings (78 loads of choice cuts, 37 loads of select cuts, zero loads of trimmings, 28 loads of ground beef).

FRIDAY'S CASH CATTLE CALL: 

Steady with Thursday's weakness. Assuming the generation of at least moderate trade volume on Thursday, cash action Friday could be limited to clean-up activity.

FEEDER CATTLE

Aping the same turnaround pattern on display in the live market, oversold feeders closed mostly 112 to 240 higher. And just like spot August live, August feeders bounced off the 100-day moving average to settle back above the 8-day moving average low. The cooling of the corn trade may have also been somewhat helpful. CME cash feeder index: 07/05: $147.84, up $0.31.

LEAN HOGS

Judging by overbought oscillators, lean futures were probably due for a rest. Accordingly, the first three contracts faltered by 57 to 192 with August catching most of the heat. Still, the action seemed more corrective than having any real technical significance. Most deferred issues settled modestly lower, probably support in part by the unwinding of bull spreads. Carcass value closed moderately lower with all primals suffering some erosion (especially the rib). Pork cut-out: $103.84, off $0.57. CME cash lean index for 07/03: $91.93, up $0.22 (DTN Projected lean index for 07/05: $92.40, up $0.47).

FRIDAY'S CASH HOG CALL: 

Steady to $1 higher. Look for hog buyers to pursue late-week procurement with steady to $1 higher bids.