Weekly Market Recap – December 4, 2020
In the Markets
The week ended with US coronavirus statistics hitting unprecedented levels. New cases numbered more than 210,000, hospitalizations exceeded 100,000 and the death toll surpassed 275,000 nationwide. On employment, analysts’ average expectation for November non-farm payrolls was 432,000, but the figure came in at 245,000. In terms of new jobs added, this is the smallest increase since the US recovery began in May. October’s NFP had been 610,000. Jobless claims by new applicants fell to 712,000 vs. 787,000 the previous week. 20.16 million Americans are receiving unemployment benefits, down from 20.51 million. As a monthly percentage, the unemployment rate slipped from 6.9% to 6.7%. October’s balance of trade level showed that the deficit grew by $1.0 billion, coming in at -$63.1 billion, compared to -$62.1 billion for September.
Equities indices stayed on their upward course all week, ending at all-time highs. The DJIA rose 307.89 (+1.0%), hitting 30,218.26 at Friday’s close; a 60.77 rise in the S&P 500 (+1.7%) took it to a 3,699.12 close. Likewise, the NASDAQ Composite index staged another record high with its 258.38 up move (+2.1%) to a 12,464.23 final mark. The Russell 2000 also gained 2.1% (+3.20 points), reaching 152.09 at week’s end. Volatility in equities has ticked slightly lower, as the CBOE VIX ended at 20.79 with a modest 0.05 decrease (-0.2%). In the currency market, the dollar weakened further, as the spot US Dollar Index ended at 90.80, a level that the index hadn’t traded since April 2018. The Canadian Dollar reached a two-year high at 77.61¢ per USD. In the S&P GSCI, the commodity gainers and losers canceled each other out, so the benchmark was marginally unchanged (+0.1%), up 0.48 and settling at 388.54 for the week.
As a sector, most metals strengthened. COMEX copper added 10.7¢ (+3.1%) closing at $3.5245/lb., its highest price in over seven years. LME three-month aluminum gained $45.50 (+2.3%), ending the week at $2,044.00 per metric ton. In the precious group, only palladium decreased, with its $81.90 price loss (-3.4%) to $2,357.80 per ounce. Due to palladium being less liquid than the other precious metals we follow, Friday’s drop might have been a technical matter involving the rolling of December contracts into March, which was compounded by the fact that CME is soon to change the palladium minimum price fluctuation increment from $0.10 to $0.50 per ounce. Allegedly, some analytic spread programs have issues with the increment change. On the other hand, platinum jumped $108.00 (+11.2%) to $1,072.80 where it settled. Platinum had not traded above $1,000 since August. Futures for gold and silver also moved on the plus side: gold rose by $51.90 (+2.9%) to $1,840.00 and silver increased by $1.614 to $24.253 (+7.1%).
Crude oil prices gained somewhat, as OPEC and key Russian oil-producing companies finally agreed on a production cut of 500,000 barrels per day. The cut was already “in the market” and had been mostly discounted. Petroleum futures ended the week up from the prior Friday. January WTI closed at $46.26, which was up $0.73 (+1.6%). ICE Brent rose 2.1%, gaining $1.00 to settle at $49.25 per barrel. In the refined products, heating oil rose 1.81¢ to close at $1.4030 (+1.3%), while RBOB gasoline gained 0.25¢, settling at $1.2685 (+0.2%). Natural gas traders are reacting to the longer-term weather outlooks that focus on La Niña. NOAA’s Climate Prediction Center and other forecasters are calling for warmer-than-normal temperatures in the Midwest, Northeast and West as winter approaches. January natgas futures tumbled 26.8¢ (-9.4%) during the course of the week, closing at $2.575, its lowest end-of-week level since March 6th ($2.471).
Prices of all nine of the agricultural products we regularly report in this recap decreased from the prior Friday. Wheat settled at $5.75½ per bushel, down 30½¢ (-5.0%). Corn, with its $4.20½ close, lost 13¼ ¢ (-3.1%) for the week. Soybeans went out at $11.65, after falling 27¾ ¢ (-2.3%). Livestock weakened as a round of coronavirus related news hit the meatpacking industry again. Cattle sagged 0.850 during the week (-0.8%) to a 112.400 close, while hogs ended at 66.570 for February, shedding 0.680 (-1.0%). Coffee decreased 6.65 (-5.4%) to 117.55 from the previous Friday. Sugar slid 0.38 (-2.6%) to its 14.44 settlement. Cocoa gave back $112 (-4.0%) for the week, closing at $2,654 per ton. March cotton retreated 1.67¢ (-2.3%) to its 71.57¢/lb. final price.
World Cup Trading Championships®
In Futures, Stefan Seibert held 1st with a 356.7% net return. Michael O’Keeffe remained in 2nd with a net return of 279.9%. Yuwen Cao remained in 3rd with a net return of 218.6%. Brent Carlile and Evgeny Kartashov rounded out the top 5 with net returns of 184.2% and 165.8% respectively.
In the Forex division, Patrick Nill held the top spot with a 243.6% net return. Sergey Shirko held 2nd with a 129.2% net return, with Jan Smolen in 3rd with a net return of 100.8%. Scott Welsh and Raul Glavan rounded out the top 5 with net returns of 91.9% and 88% respectively.
In the futures division of the 2020-2021 Global Cup Trading Championship, Stefan Seibert maintained first with a net return of 148%. M. Vontobel of Tirutrade AG climbed up to 2nd with a 119.2% net return. 3rd place is currently held by Patrick Nill with a net return of 105.9%. Jan Smolen and Fernando C. Piñeiro finished the week in 4th and 5th with 101% and 91.5% net returns respectively.
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