June 25, 2018 / 10:09 PM / in 10 months

LIVESTOCK-Live cattle futures tumble on weak equities, technicals

    By Julie Ingwersen
    CHICAGO, June 25 (Reuters) - Chicago Mercantile Exchange
live cattle futures         fell nearly 3 percent on Monday as
spillover weakness from financial markets and expectations of
rising cattle supplies pushed the benchmark August contract
       below chart support levels, traders said.
    Feeder cattle         and lean hog futures         also
closed lower.
    Declines on Wall Street set the tone, raising concerns among
livestock traders that U.S. consumers might grow reluctant to
buy beef. The Dow Jones Industrial Average ended the session
below its 200-day moving average for the first time since June
2016 as the trade fight between the United States and other top
economies escalated.             
    "With the weakness we saw in our equity markets, with all
the trade concern, that was tipping point for today," said Don
Roose, president of Iowa-based U.S. Commodities.
    U.S. Treasury Secretary Steven Mnuchin said forthcoming
investment restrictions would apply "to all countries that are
trying to steal our technology," not just to China. 
    Hours later, White House trade and manufacturing adviser
Peter Navarro walked back Mnuchin's remarks, telling CNBC that
the restrictions on investing in tech companies would just
target China.             
    Meanwhile, France moved closer to exporting beef to China by
clinching a health and safety accord with Beijing, raising the
prospect of sales to a booming Chinese market just as U.S. beef
shipments are threatened with tariffs.             
    CME August live cattle        settled down the 3-cent daily
limit at 102.900 cents per pound after falling below chart
support at its 50-day moving average. Limits for live cattle
futures will expand to 4.5 cents for Tuesday's session.
    CME August feeder cattle        ended down 3.425 cents at
145.775 cents per pound.
    Traders said cattle futures were still reeling from last
week's weaker cash cattle prices and Friday's slightly bearish
cattle-on-feed report from the U.S. Department of Agriculture.
    Market-ready cattle at U.S. Plains feedlot markets traded
last week from $108 to $110 per cwt, compared to $110 to $113 a
week earlier.
    The USDA's report showed ranchers in May drove more cattle
into U.S. feedlots than expected compared with the same period a
year ago.               
    "We've got our biggest numbers of cattle coming at us, (now)
through the middle of August," Roose said.
    Lean hog futures fell for a second straight session, with
the benchmark August contract        touching a 2-1/2 month low.
    CME July lean hogs        settled down 1.750 cent at 78.075
cents per pound and August        ended 1.775 cents lower at
73.600 cents.

 (Reporting by Julie Ingwersen; Editing by Richard Chang)
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