The Early Vibe

08/08/11 -- America's credit rating cut late Friday has triggered further broad-based selling in commodities and equities in the Far East this morning. Crude oil is down more than USD3.00/barrel at 8am London time, that's a 12.7% decline since the end of July.

Asian stock markets continued their decline with Hong Kong's Hang Seng falling 3.5% this morning. Gold meanwhile is at a new record high approaching USD1,700/oz, as investors are stuck for ideas as to where exactly is a good place to put their money.

The normal safe haven of the dollar doesn't look quite so reliable any more, with the pound rising to 1.6450 against the greenback.

The overnight Globex grains are under pressure too, with soybeans down 12-14 cents, corn falling 6-7 cents and wheat 7-9 cents weaker.

The weekend saw a significant amount of rain fall with 50% coverage over large parts of the Midwest, say WxRisk weather. We have to look beyond the 6-10 day forecast to the 11-15 day range to see any real heat on the horizon, but even that far forward it's only the Lower Plains and Deep South that look at risk, they add.

Besides keeping an eye on developments in the US and with regards to the European debt crisis too, we also have the not insignificant matter of the USDA reporting on US and world crop production, consumption and stocks later in the week.

By now I doubt if anybody underestimates the USDA's capacity to spring a surprise here, indeed it almost seems that they're expected to do it as a matter of routine.

I'll be keeping an eye on things from my sun lounger by the pool in Portugal across the next two weeks, and will at least be attempting to update my comments on the EU and CBOT grains closes every night.

Good luck with the harvest weather in dear old Blighty. TTFN. Nogger.