DTN Early Word Grains 08/05 05:55

DTN Early Word Grains 08/05 05:55 Grains Swoon on Trade War Escalation, Forecast December corn is down 5 3/4 cents per bushel, November soybeans are down 6 3/4 cents, and September K.C. wheat is down 6 3/4 cents. By Tregg Cronin DTN Contributing Analyst 6:00 a.m. CME Globex: December corn is down 5 3/4 cents per bushel, November soybeans are down 6 3/4 cents, and September K.C. wheat is down 6 3/4 cents. CME Globex Recap: Global equity markets are under heavy pressure after trade war escalation helped drive the Chinese renminbi below 7:1 against the U.S. dollar. This is the first time the pair has traded below that threshold since the financial crisis in May of 2008, which would seem to confirm the deteriorating conditions between the world's two largest economies. The weakness is being felt across all asset classes with the U.S. Dollar Index posting sharp losses the last three sessions. Grains are sharply weaker after reports suggested the Chinese government has asked its state-owned enterprises to suspend imports of U.S. agricultural products in response to the latest round of U.S. tariffs. This all but assures the soybean sales still on the books for the 2018/19 marketing year will not execute. In addition, weather forecasts remain non-threatening through mid-August with the August WASDE still a week away. Even with smaller supply prospects, if they are confirmed, the bearish wall of demand appears overwhelming at this juncture. OUTSIDE MARKETS: Previous closes Friday showed the Dow Jones Industrial Average down 98.41 at 26,485.01 and the S&P 500 down 21.51 at 2,953.56 while the 10-Year Treasury yield ended at 1.855%. Early Monday, the September DJIA futures are down 302 points. Asian markets are lower with Japan's Nikkei 225 down 366.87 (-1.74%) and China's Shanghai Composite down 46.34 points (-1.62%). European markets are lower with London's FTSE 100 down 156.86 points (-2.12%), Germany's DAX down 179.52 points (-1.51%) and France's CAC 40 down 110.98 points (-2.07%). The September Euro is up 0.004 at 1.120 and the September U.S. dollar index is down 0.232 at 97.620. The September 30-Year T-Bond is up 58/32nds, while December gold is up $11.30 at $1,468.80 and September crude oil is down $0.56 at $55.10. Soybeans on China's Dalian Exchange were up 0.77% while soybean meal was up 1.46%.