Cattle futures rebound on Wall Street
After an unsteady trading day on Monday, US live cattle futures rebound as the world's leading economies make moves alleviating coronavirus fears.
11 March 2020
2 minute read
According to reporting from Reuters, US live cattle futures closed higher on Tuesday as part of Wall Street's charge back from Monday's losses. Traders have attributed the rebound to large economies moving to cushion the impact of the coronavirus.
The rally in global equity markets overshadowed bearish fundamentals in the cattle market, including declining cash cattle prices in recent weeks and uncertainty about consumer demand for steaks and other expensive cuts of beef given the threat of a global recession.
"It's just a consolidation after the big sharp decline the last couple of days," Altin Kalo, agricultural economist for New Hampshire-based Steiner Consulting, said of the bounce in cattle futures. "It seems we've thrown the fundamentals out the window here for a minute," Kalo said.
Equity markets jumped as hopes of government stimulus calmed investors' fears surrounding the coronavirus and signs of imminent recession. US President Donald Trump said he will take "major steps" to allay market fears by asking Congress for a fiscal stimulus package to include a payroll tax cut, among other measures.
Chicago Mercantile Exchange April live cattle settled up 2.600 cents at 105.450 cents per pound and June cattle rose 2.425 cents at 99.525 cents a pound.
CME April feeder cattle settled up 2.400 cents to end at 127.950 cents per pound, trading under expanded daily limits after Monday's limit-down close. Daily limits for feeder cattle futures will revert to 4.5 cents for Wednesday's trade.
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