Weekly Market Recap – January 7, 2022
The minutes released from the Federal Reserve’s December meeting show that high inflation is convincing central bank officials to rethink their policy path.
Monthly economic statistics reported during the week, compared with prior releases, were as follows: construction spending +0.4% vs. +0.4%, consumer credit $20 billion vs. $17 billion, trade deficit -$80.2 billion vs. -$67.2 billion, factory orders +1.6% vs. +1.2%, non-farm payrolls 199,000 vs. 249,000, unemployment rate +3.9% vs. +4.2%, job openings 10.6 million vs. 11.1 million, and job quits 4.5 million vs. 4.2 million. Weekly initial jobless claims were 207,000 vs. 200,000.
All three equities indices that we monitor declined for the week. The largest percentage drop was the NASDAQ Composite, with had a 4.5% down-move to 14,935.90. The S&P 500 closed at 4,677.03 (-1.9%), and the DJIA lost only 0.3%, ending at 36,231.66 Friday. A rising CBOE VIX accompanied the sell-off in stocks; the volatility marker jumped 8.9% to 18.76 at the close. The U.S Dollar Index inched up to 95.73 with a 0.1% improvement. Influenced by strength in energies and ags, S&P’s GSCI gained 3.0% to close at 578.11, its highest Friday settlement in eight weeks.
The metals futures contracts we follow were mixed. Settlements and weekly percentage changes were as follows: gold at $1,797.4 (-1.7%), silver at $22.409 (-4.0%), platinum at $956.50 (-1.0%), palladium at $1,921.60 (+0.5%), copper at $4.4100 (-1.2%) and aluminum at $2,914.50 (+3.8%).
The energy sector rallied across the board. Crude oil gained more than three dollars per barrel, going out at $78.90 for WTI (+4.9%) and at $81.75 for Brent (+5.1%). Likewise, refined petroleum products increased, with heating oil closing at $2.4818 (+6.7%) and RBOB gasoline at $2.2989 (+3.3%). Natural gas had a 5.0% rally as winter U.S. temperatures returned to the colder side sending the front month to $3.916 per mmBtu.
Of the nine agricultural contract prices we report, five advanced, and four retreated. Those in the red were: wheat at $7.58½ (-1.6%), sugar at 18.05¢ (-4.4%), live cattle at 137.325 (-1.7%), and lean hogs at 79.650 (-2.2%). The gainers were: soybeans at $14.10¼ (+5.3%), corn at $6.06¾ (+2.3%), coffee at $2.3845 (+5.5%), cotton at 115.12¢ (+2.2%) and cocoa at $2,521 (+ one tick, or +0.04%).
Futures Referenced in Market Recap
|NYMEX||ULSD (Heating Oil)||February|
|LME||Aluminum||3 Mo. Forward|
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