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The Big Picture

Commodity

From Breadbasket to Bystander: Wheat Falls Out of Favor in American Fields

Many U.S. wheat growers are feeling new pressure as the planting season begins. With rising input costs and better returns from corn, soybeans, and biofuel-linked crops, farmers are rethinking how much land they devote to wheat.

Biofuel incentives continue to overlook wheat, leaving the grain with no viable role in major renewable fuel programs. This exclusion has made corn and soybeans more attractive, especially in northern states where wheat once dominated.

Technology access is another major challenge. Unlike corn and soy, wheat has seen limited private investment in seed innovation, particularly around hybrid or gene-edited varieties. U.S. wheat growers are falling behind global competitors who are racing ahead with new breeding methods and higher yields.

The bigger concern is how these structural disadvantages reshape U.S. agriculture. Shrinking acreage may weaken America’s standing in global wheat markets, where players such as Canada, Ukraine, and Russia are poised to fill supply gaps. The loss of scale could also erode U.S. pricing power and food security resilience in a volatile global landscape.

Looking ahead, farmers face tough choices. Rising input costs, tighter delivery networks, and flat safety nets are forcing a reckoning for one of the oldest U.S. crops. Without strategic intervention, wheat could continue to surrender ground and relevance.

Consumer

Energy Cuts Spark Nationwide Utility Price Spike Fears

Massive cutbacks at the U.S. Department of Energy are stirring fresh concerns about rising utility bills and stalled innovation across the country. Federal deregulation and reduced funding have triggered a wave of internal exits, affecting nearly half of the workforce.

Federal data projects that American households may face higher electricity bills over the next decade, driven by the rollback of energy efficiency programs that were once designed to reduce costs in the long term.

Analysts have warned that eliminating appliance standards, reducing R&D support, and shrinking grant programs could reverse years of progress in lowering energy expenses and promoting cleaner technologies.

What’s at stake isn’t just immediate price relief. It’s the broader economic fallout of halting forward-looking energy efforts. U.S. competitiveness in the clean power race, especially in solar, battery, and AI-related grid demands, could weaken just as demand surges.

Utilities are already bracing for higher costs, with data showing nearly all new power added to the grid last year came from carbon-free sources. Stripping support for future upgrades may increase costs across all regions, particularly for low-income households and small businesses.

U.S. energy policy is now entering a critical phase where affordability and advancement could be at odds. The full impact of this shift will be felt not just in homes but in global tech and manufacturing competitiveness for years to come.

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Industrial

U.S. Steelmakers Capitalize as Global Pressures Mount

The U.S. plans to double tariffs on steel imports from 25% to 50%, signaling a sharp shift in industrial policy that could redefine domestic steel production and global supply flows.

Industry players, such as Cleveland-Cliffs, Steel Dynamics, and Nucor, saw immediate benefits as capital poured into U.S.-based producers. While global partners condemned the move, domestic sentiment suggests the policy may reinforce steel’s role in U.S. infrastructure, energy, and defense.

Policy clarity on sourcing and long-term procurement could follow, with ripple effects anticipated across the construction, automotive, and renewable energy manufacturing sectors. For U.S. steelmakers, the hike could provide leverage to expand capacity, negotiate better terms, and insulate margins against global price pressures.

Global reactions have been swift. The European Union is preparing countermeasures while Asian exporters brace for redirection in trade flows. What matters now is how supply chains adapt and how long U.S. buyers can absorb higher input costs.

This moment puts the spotlight on U.S. steel as a strategic asset. The tariff hike may reshape procurement and accelerate reinvestment in domestic mills, but it also opens the door to new trade frictions that won’t fade quietly.

Metrics to Watch

• Restaurant Sales: A key indicator of consumer discretionary spending, restaurant order sales, are up 10% year-over-year.  

• Inflation: We’re so close, yet so far - inflation slowed from 2.3% to 2.1% in last week’s report, just a hair above the Fed’s 2% target. But tariffs could act to counter the Fed’s successes.  

• Personal Income: Income rose, however, by 0.8% and well above the 0.1% month-over-month inflation increase.    

• Savings Rate: Americans didn’t go spend it all, though, as the personal savings rate hit its highest level in a year at 4.9% - indicating some unease around future macro conditions.

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Market Movers

🇺🇸🇨🇳 Trade Talks Imminent? An anonymous White House official told reporters that Presidents Trump and Xi Jinping plan to speak later in the week, (hopefully) providing some much-needed clarity and closure to the ongoing trade and tariff war. The back-and-forth following Trump’s 90-day trade tax pause ramped up the “nervousness factor,” especially after Chinese officials accused U.S. policymakers of acting in bad faith by issuing tech trade embargoes on major Chinese companies like Huawei. 

🏀 Watch Out, Sports Betting Stocks: Online sports betting companies are facing increased regulatory scrutiny in general, with Illinois specifically passing a budget bill this week that raises taxes for digital wagering platforms. The sudden and unexpected tax hike could be the first in a waterfall effect across other state legislatures, putting stocks like DraftKings (NASDAQ: DKNG) and Flutter Entertainment (NYSE: FLUT), owners of FanDuel and similar platforms, at serious revenue risk. 

🛢️  OPEC+ Plans Production Hike, Oil Prices… Increase? The oil trade cartel announced another planned production hike for July, striking fear into energy markets as oversupply problems loom. Oil prices gained following the announcement, however, bucking expectations and primarily due to escalations on the Russia/Ukraine front that put Eastern Europe’s abundant crude production facilities at risk.  

☀️ Energy Shorts: Speaking of which, energy stocks are among the most-shorted this year and currently sit at 2.6% short interest across large-cap sector components. That may seem slim compared to typical “most-shorted” companies, but is astronomical for an entire sector’s worth of stocks.

Traders looking for a short squeeze in energy markets may want to check out the Energy Select Sector SPDR ETF (NYSEARCA: XLE), which is down 11%+ over the past year and represents a solid swath of firms to bet on a rebound.

Market Impacts

Equities: Low volatility, value-based stocks were the market’s undeniable losers of the past few years as high-growth, high-risk tech stocks stole the spotlight. The trend reversed thus far in 2025, however, as strategies screening for low-volatility stocks like Berkshire-Hathaway (NYSE: BRK.A, NYSE: BRK.B), up 10% since January, and Coca-Cola (NYSE: KO), +15% this year, prove that there are still plenty of trade opportunities despite a frothy tech sector. 

Bonds: Bond markets are coming into increased focus as the Trump administration and lawmakers weigh promises - tax cuts nearly across the board - with the reality of swelling U.S. debt and falling fixed-income investor interest in American sovereign debt. JPMorgan Chase CEO Jamie Dimon sounded the alarm earlier today, saying that volatility in the bond market will have negative trickle-down effects across U.S. consumers and small business owners.  

Currencies: Big news for the U.S. Dollar is on the horizon as stablecoin issuer Circle plans to IPO later in the week; the crypto company issues dollar-denominated USDC, which is the second-largest stablecoin globally. Increased interest in dollar-backed stablecoins may help smooth out recent volatility in currency markets and “prop up” (for lack of a better word) American capital. 

Commodities: One U.S. commodity sector, steel, is set to benefit big from tariffs after Trump announced a plan to double the trade tax on imports (to 50% from 25%). Though downstream manufacturers will end up paying the price, upstream steelmakers are in a solid position to benefit from a smaller competitive pool - look to Cleveland-Cliffs (NYSE: CLF), Nucor (NYSE: NUE), and Steel Dynamics (NASDAQ: STLD) as domestic beneficiaries.

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Key Indicators to Watch

• 📅 Job Openings (April) – June 3rd: Recent pushback on gloomy labor market news may collapse if April’s openings fall flat.    

• 📅 Fed Beige Book – June 4th: The second-most anticipated Fed release (after FOMC minutes), Wednesday afternoon’s release could set the tone for the remainder of June. 

• 📅 Initial Jobless Claims (Week of May 31) – June 5th: Initial claims will serve as a nice complement to April’s job opening report to either reinforce the trend or tell investors that tides are turning. 

Everything Else

• Affordable EVs are back in focus as Elon Musk stands accused of scuttling plans to develop and deploy a $25,000 “Model 2” auto. 

• Check out more about Circle’s planned IPO and dollar-denominated stablecoin offerings here.

• Traders may have reacted positively to Trump’s tariff pause, but manufacturers haven’t seen much benefit yet. 

• Some Fed officials are changing their tune amid positive inflation data and see opportunities for multiple rate cuts in 2025. 

• The EU is the latest trading block to threaten retaliatory tariffs after Trump’s recent comments.