AM markets: ags stage rebound, as focus returns to weather
...MUCH MOREWas that it?Certainly, investors started off the week with a bigger appetite for risk assets – and especially for agricultural commodities - than that with which they ended last week, when the tremors from the UK's Brexit vote shook markets worldwide.Shares rose on Asian markets, adding 2.4% in Tokyo and 1.4% in Shanghai.OK, gold, the flagship safe haven bet (and viewed by some investors as a proxy for farmland prices), maintained its upward run – but with gains of 1.5% in early deals came nowhere near its 4.8% jump on Friday, the biggest one-day gain since January 2009.But the dollar, another rock for investors in troubled times, eased back a fraction, shedding 0.1% against a basket of currencies.And that helped lure commodity bulls from their Brexit-resistant bunkers, with oil, viewed by many commentators as the flagship raw material, adding 0.5% to 48.64 a barrel, for Brent crude as of 09:35 UK time (03:35 Chicago time).Pound lighterSure, for investors in Europe and the UK, the Brexit issue has not gone away, as evident in currency moves within the region.The euro shed a further 0.5% against the dollar, to E1.105 to $1, failing to break back above the 200-day moving average lost in the last session, but also failed to come anywhere near the intraday lows seen then either.And sterling lost a further 1.85 to stand a little over £1.34 to $1, again keeping a bit of distance from Friday's 30-year low of £1.3224 to $1.The currency moves bode well for prices of European agricultural commodity contracts, eg London cocoa and Paris wheat.Chicago futures bounceIndeed, they could get a double boost, factoring in also the draw from a sprightly start to US-traded ags, with Chicago grains seeing an extension of the late buying noted in the last session, which saw futures close well above intraday lows (and even in positive territory for spot Chicago wheat).Chicago wheat futures for July added a further 0.9% in early deals on Monday, taking it to $4.59 a bushel, with the better-traded September lot gaining 0.9% to $4.69 ¼ a bushel....
Also at Agrimoney:
Three ways to profit in agriculture from Brexit
The good, the mixed, the worrying - three Brexit effects on world ag
Brexit - what does it mean for agriculture and global markets?