Shouchuang Futures: Sector Resonance, Two Soybean Meals Continue to Decline

Today, domestic oil and fat and oilseed varieties fell across the board, and the two soybean meal contracts continued to decline. Trump said he is not seeking to control the Strait of Hormuz, that he will end the conflict within three weeks, and that he plans to release important news tomorrow morning. Expectations that the conflict in the Middle East will ease triggered sharp swings in market sentiment; meanwhile, oil and fat and oilseed varieties that had previously benefited from rising crude oil prices generally weakened. Overnight, soybean costs rebounded slightly, as bullish data from an 84.70 million acres area report drove a slight rebound in U.S. soybeans, but market sentiment dominated the afternoon selloff. Overall, in the near term, the market has been digesting expectations of weaker domestic supply and demand through falling prices; however, cost support means there is limited room for prices to drop, so it is not advisable to chase shorts too aggressively in a one-sided manner. Watch for market sentiment fluctuations after Trump speaks tomorrow. (First Capital Futures)