Weekly Market Recap – April 24, 2020
In the Markets
This week, the trading markets absorbed Thursday’s labor department report of 4.4 million jobless claims, a number lower than the three previous weekly releases. This brings the total claims reported in April to 23.1 million.
In other Coronavirus related news, more economic stimulus legislation was enacted. On Friday, the president signed a $484 billion package for small businesses, hospitals, and first responders. Due to the fact that investors had anticipated the unemployment and relief news, the market reactions lacked volatility, evidenced by the mere blip of CBOE’s VIX: increasing 2.47 points (+6.3%) for the week. This so-called “fear index” closed at 41.52 on Friday, slightly below 46.17 – its 2020 mean.
Stock index performance was relatively uneventful as the DJIA closed 467.22 lower, at 23,775.27 (-1.9%), and the S&P 500 settled with a decrease of 37.82 points, bringing it to 2,836.74 (-1.3%). The other equities benchmarks that we monitor here hardly budged; NASDAQ’s composite lost 0.2% with its -15.62 point move to 8,634.52. The Russell 2000 index managed a slight rise of 0.45 points to 98.75 (+0.5%).
Precious metal futures also held fairly steady, with June gold closing at $1,745.70 (gaining $46.90 or 2.8%), and May Silver rising only 6¢, a +0.4% move to $15.35 per ounce. July platinum lost $3.60 (-0.5%) going out at $781.70 at week’s end, while palladium declined $154.90 (-7.3%) to $1,976.00 for the June contract. Base metals, as well, hardly changed. CME copper had a one-cent drop to $2.337 per pound (-0.3%). LME aluminum gained 0.2% with its $3 gain to $1,510 per metric ton.
A week ago, our energy recap described the continuing crude oil decline as a reaction to the problem that storage facilities were at, or near, full capacity. That situation played out last Monday. In an unprecedented move, the soon-to-expire May WTI contract plunged into negative price territory. Crude tumbled most of the session, closing at minus $37.63, which was $55.90 lower than it had settled the previous week. May crude had become a “hot potato”: nobody wanted it, there was no place to store it, and those who owned it were scrambling to unload it, even if they had to pay the buyers. (At expiration on Tuesday, it re-entered positive territory to settle at $10.01 – down 83.3%, year-to-date.) The new nearby contract, June WTI ended the week at $17.18 per barrel, down $7.85 (-31.4%). ICE Brent fell $6.14 (-21.9%) to $21.94 at the close. May refined products moved lower as heating oil dropped to $0.6729 (-29.6%), and RBOB gasoline eased $0.0524 (-7.4%). Natural gas had rallied earlier in the week, and then corrected back to $1.746 at week’s end, down $0.0430 (-2.5%).
In agricultural futures, a couple of markets were impacted by Brazil’s currency crashing against the US dollar. The spot Real (“BLRUSD”) closed at $0.1979 on Friday, an all-time low. Coffee and sugar traders who closely follow Brazil’s exports of those commodities sold heavily, anticipating that producers would increase sales to make up for their shrinking Reals. July coffee declined 8.6% for the week, to a $1.0675 close. July sugar lost 6.8%, closing at 9.81¢, also a record low.
On the CBT, wheat rallied early in the week on talk that Ukraine would increase export cuts, but by Friday, the pressure had faded, and the May contract ended at $5.2675/bushel, down 6.75 cents (-1.3%). Corn booked a 6.5 cent decline to $3.1575 (down 2.0%). Soybeans for May closed at $8.3225 on Friday, only down a quarter of a cent, statistically a zero percent change.
World Cup Trading Championships®
Michael O’Keeffe held onto the top position passing the 1,000% mark with a 1,043.1% net return. A. Masters and Allen Swiontek are in close competition for 2nd and 3rd, with net returns of 383.5% and 381.1% respectively. Yuwen Cao passed Stefano Serafini for 4th with a net return of 272% to Serafini’s 176.7%.
In the Global Cup, Michael Cook maintained 1st with a 229.6% net return. Stefan Seibert held 2nd with a net return of 206.8%. Maxim Schults moved into 3rd with a 136.3% net return. Wayne Wan moved into 4th with a 128.4% net return and Robert Miner stayed on the leaderboard in 5th with a 118.6% net return.
In the Forex division of the World Cup Trading Championships®, Nicholas Ridley finished the week holding onto first place with a net return of 81.8%, followed by Raul Glavan at 69.8% and Chien-Hung Chen at 63.9% net. Michel Campanale joined the leaderboard with a net return of 63.6% and WenChen Zhang stayed on the leaderboard with a net return of 45.2%.
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