Weekly Market Recap – January 11th, 2019

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Weekly Market Recap – January 11th, 2019

In the Markets

After a tumultuous end to 2018, with high market volatility the major equity indices have climbed to start the new year amidst positive investor sentiment. The S&P closed the week up 2.5%, resulting in a 3.6% YTD return in 2019. The Dow Jones rose 2.4%, up 2.9% YTD, and the NASDAQ finished the week up 2.5%, totaling a 5.1% growth YTD.

A myriad of factors have contributed to this new year, new market recovery.. The latest jobs report showed 312,000 added in December, along with faster wage growth, up 0.4% on the month. This was much higher than the expected 184,000 gain. Additionally, October and November were revised upward, resulting in the last three months of 2018 averaging a monthly job growth of 254,000.

Additionally, a more dovish tone was taken by Fed Chair Powell regarding interest rates and inflation, backed up by the Fed’s latest policy meeting that stressed patients with regards to further rate hikes.

On the trade front, meetings in Beijing between U.S. and Chinese officials extended beyond their scheduled 2 days, with encouraging comments coming from the 3 day talks that may hint to progress in the trade negotiations.

Crude oil continued its positive trend in 2019, with both WTI and Brent futures posting their second consecutive weekly gains, up 7.57% and 6.03% on the week respectively. Oil products also finished the week in positive territory, with gasoline gaining 3.92% and heating oil rising 6.25%. Natural gas ended the steep drop that began 2019, up 1.81% on the week.

Agricultural markets faced a unique obstacle this week when the USDA did not release its January WASDE report on January 11th due to the ongoing U.S. government shutdown. The resulting lack of data may add uncertainty to hedgers and speculators as they attempt to navigate market moves. On the week, corn and soybeans both dropped 1.2%, while wheat gained a meager 0.48%.

Softs were one of the top performers in commodities, as sugar gained 7.12%. Coffee finished up 2.21% as the Brazilian currency (Real) showed strength.

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