Weekly Market Recap – August 21, 2020
In the Markets
The homebuilding sector is emerging as one of the few strongholds in an economy battered by the pandemic. Housing starts increased by 22.6%, the largest gain since October 2016. Apple became the first US company to reach a $2 trillion valuation. New jobless claims unexpectedly jumped to 1.1 million after falling below 1 million the week before. Joe Biden accepted the Democratic presidential nomination on Thursday night
Equities investors kept the ball rolling as the S&P500 hit a new all-time high. The Friday close of 3,397.16 was up 24.31 (+0.7%) for the week, and 5.1% is its year-to-date gain. The star performer, however, was the NASDAQ Composite. Its new record close of 11,311.08 was up 292.50 for the week (+2.7%), taking it up 26.1% for the year. Statistically, the DJIA was unchanged for the week (0.00%), with its mere 0.69 point decline resulting from closing at 27,930.33 on Friday. The Dow’s move in 2020 now stands as a modest 2.1% drop. The Russell 2000 slipped, losing 1.97 points (-1.6%), settling at 124.56 on the close, which is off 6.5% for the year. CBOE’s VIX ticked higher for a change, up 0.49 points (+2.2%). Its 22.54 settlement reverses course somewhat, as the volatility benchmark had been steadily eroding since mid-June. The US Dollar Index also bounced up this week, having been in a retreat for nearly two months. It ended up 0.11 points (+0.9%) with its 93.20 close. S&P’s GSCI rose slightly by 1.19 (+0.1%) to 353.36 on Friday.
Precious metals were mixed: silver outshined gold, as did palladium to platinum. Silver futures rallied 78.8¢ (+3.0%) ending the week at $26.877 per ounce. December gold backed off further from the $2,000 handle, easing $2.80 (-0.1%) with a final price of $1,947.00 at week’s end. September palladium advanced $36.50 (+1.7%) to $2,180.30 and platinum moved lower by $33.00 (-3.4%) to $926.10/oz. The base metals we cover in this recap both firmed, as CME copper added 5.85¢ (+2.0%) settling at $2.9175 per pound and LME aluminum ended the week at $1,765.00/ton, a gain of $19.00 (+1.1%).
Crude oil prices have softened as OPEC members are adhering to the agreed-upon production cuts. Petroleum futures ended the week down from the prior Friday. October WTI closed at $42.34, which was off $0.97 (-2.2%). ICE Brent eased 1.0%, losing $0.45 to settle at $44.35 per barrel. Refined products were mixed, with heating oil sliding 2.87¢ to close at $1.2080 (-2.3%), while RBOB gasoline gained 3.95¢, settling at $1.2841 (+3.2%). The task of the natural gas trader in this market now requires keeping eyes on both storms. In Friday’s session, the September natgas futures contract surged over 15¢ during the course of the day, trading at its highest level since May 5th. The market’s weekly change was an increase of 9.2¢ (+3.9%), ending at $2.448 per MMBtu.
In the agricultural sector, the most actively traded markets increased from the prior Friday’s levels. Wheat settled at $5.27¼ per bushel, up 27¼¢ (+5.5%). Corn, with its $3.40½ close, gained 2½¢ (+0.7%) for the week. Soybeans went out at $9.00¾ after rising 2¢ (+0.2%). Most, but not all, of the softs showed strength, despite the bounce in the US dollar, with coffee up 5.40 to 120.10 (+4.7%) from the previous Friday. Sugar fell, backing off more from the 13¢ level, down 0.27 (-2.1%) to its 12.83 settlement. Cocoa, for the week, added $23 (+0.9%), closing at $2,459 per ton. December cotton advanced 1.43¢ (+2.3%) to its 64.28 final price. Livestock was mixed, as cattle futures sagged 1.680 (-1.5%) to a 108.550 close, while hogs ended at 54.250 for October, rising 1.230 (2.3%). As could be expected by the homebuilding news, lumber futures hit another all-time high. The CME September contract closed the week up $104.40 (+14.4%), settling at $830.90 per 1,000 board feet.
World Cup Trading Championships®
In Futures, Michael O’Keeffe has held the top position, based on the end of week standings, for the 19th week in a row with a 439.9% net return. Stephan Seibert held 2nd with a net return of 236%. Orhan Özcan remained in 3rd with a net return of 213.9%. Yuwen Cao and Stefano Serafini rounded out the top 5 with net returns of 211.3% and 158.2% respectively.
In the Forex division, Nicholas Ridley remained in the top spot with a 218.6% return. Jan Smolen held 2nd at 125.3%, with Sergey Shirko finishing the week in 3rd with a net return of 118.2%. Raul Glavan and Patrick Nill rounded out the top 5 with net returns of 111.6% and 72.4% respectively.
In the futures division of the 2020-2021 Global Cup Trading Championship, Adrian Koemel claimed first with a net return of 68.9%, with Jan Smolen following in 2nd at 59.8%. 3rd place is currently held by Stefan Seibert with a net return of 58.8%. M. Vontobel of Tirutrade AG and Fernando Piñeiro finished the week in 4th and 5th at 43% and 40.6% respectively.
Trading futures and forex involves significant risk of loss and is not suitable for everyone. Past performance is not necessarily indicative of future results. World Cup Championship (WCC ) accounts do not necessarily represent all the trading accounts controlled by a given competitor. WCC competitors may control accounts that produce results substantially different than the results achieved in their WCC accounts. WCC entrants may trade more than one account in the competition. CME Group is the trademark of CME Group, Inc. The Globe logo is a trademark of Chicago Mercantile Exchange, Inc.