Commodity producers took center stage on Wednesday as BHP Billiton, the world’s largest mining company, made a $40 billion hostile takeover offer for Potash, the world’s biggest producer of fertilizer. The deal has roiled the markets, boosting Potash’s share price 30 percent in just two days. BHP is offering $130 per share in cash for all of the Saskatchewan-based firm’s outstanding shares.
Initially, U.S. stock index futures pointed to a slightly higher open, but all three indexes started in the red on Wednesday, sliding between 0.3 percent and 0.4 percent. Futures brokers in the currency sector eyed the Canadian dollar, which rose for the second straight day as traders speculated that a potential takeover deal could generate enormous demand for the currency.
Earnings have boosted trading sessions and led to some bullish futures trading strategies. Of the 447 S&P 500 firms that have released earnings since July 12, approximately 75 percent have beaten earnings-per-share estimates, reports Bloomberg News.
Industrial production also rose in July, even as consumer sentiment wavered in the face of economic uncertainty. Commodity traders have done much better than equities markets, though, particularly those futures brokers positioned to take advantage of the surge in grain prices.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.