Weekly Market Recap – July 24, 2020

In the Markets

The week started with the European Union agreeing to a €1.6 trillion pandemic recovery strategy based on the sale of hundreds of billions of common debt. On Wednesday, the US abruptly ordered China to close its consulate in Houston, resulting from accusations of espionage. Filings for weekly unemployment benefits are on the rise again. The recovery has been negatively affected as states have rolled back their re-openings. US Department of Labor data releases over the past months indicate 21 million American jobs were cut in March and April, but only 7.5 million new jobs were created by re-openings in May and June. The housing market rebounded in June, as low mortgage rates helped boost the sale of previously owned homes up 20.7% from May. California surpassed New York for the most confirmed coronavirus cases in the country; nationwide, deaths from COVID-19 now exceed 1,000 per day.

The DJIA fell 202.06 from the previous week (-0.86%), closing at 26,469.89 on Friday. The S&P 500 gave back 9.10 points, ending at 3,215.63 (-0.3%), and the Russell 2000 dropped 0.4% with a 0.47 decrease for the week, taking it to 117.73 to at the close. The NASDAQ Composite opened on Tuesday at a new all-time intra-day high (10,839.93), then slipped lower with the other equities benchmarks for the remainder of the week. It’s Friday close of 10,363.18 was due to easing 140.01 (-1.3%). The VIX showed the first weekly volatility uptick since June 12th. The currency basket comprising the US Dollar Index continued its downtrend, falling 1.67 (-1.7%) to 94.34 at the close: the lowest the index has been in 22 months (September 2018). S&P’s GSCI maintained its strength, marching to the drum of the falling dollar. The commodity price portfolio rose 4.55 (+1.3%) to 342.00 at the close, its highest end-of-week settlement since March 6th.

Gold, a significant component of the GSCI, made a record move on Friday. Thriving on the weak dollar, spot bullion traded above $1,900 for the first time since September 2011, and the London pm fixing hit a new historic highpoint: $1,902.10 per Troy ounce. COMEX gold futures for August had a weekly gain of $87.50 (+4.8%) to $1,897.50 at Friday’s close. Silver buying has been more vigorous than gold lately, as the September contract rose 16.1% during the week, adding $3.17 per ounce. The closing price of $22.850 was still far from its $40 levels during the 2011 gold market milestone. The other metals in the precious category went along for the ride, as well, but without any conspicuous records. Platinum rallied $106.40 (+12.5%) to $956.00 and palladium moved higher by $222.40 (+10.7%) to $2,294.10 per ounce. Base metals were mixed, as copper eased 1.2¢ (-0.4%) settling at $2.8925 per pound. Aluminum ended the week at $1,700/ton, an increase of $38.50 (+2.3%).

Crude and product futures have also been bolstered by dollar weakness, maintaining upward trends, though somewhat flatter on the charts than a couple of months ago. August WTI had its highest Friday close since early March, ending the week at $41.96 per barrel, a $1.37 increase (+3.4%). Brent added only $0.20 (+0.5%), taking it to $43.34 at settlement. RBOB gasoline had a 4.9% increase for the week (+6.03¢/gallon), printing $1.2848 at the close. Heating oil settled at $1.2563 and added 3.72¢/gallon to its price for the week, increasing 3.1% from the previous Friday. Natural gas traders are still taking cues from heatwave forecasts. August futures showed a weekly rise of 5.2%, up 9.0¢, closing at $1.808 per MMBtu.

Soybeans rose 4¼ ¢ last week (+0.5%) to close at $8.99¼ per bushel. Corn fell 4¢ (-1.4%) to a $3.35 settlement price. Wheat gained ¾¢ (+0.9%) ending at $4.39½ for the week. In the ICE softs, the Europe vs. US coffee arbitrage is still in play as Robusta increased by 5.0%, while Arabica added 6.0%, settling at $1,358 per metric ton and $1.0840 per pound, respectively. Sugar declined 2.0%, losing 0.03¢ to close at 11.49¢ per pound. Cocoa firmed, ending Friday’s session at 2,224 (+3.0%) adding 64 points. Livestock was mixed with hogs outpacing cattle. August hogs rose 2.3% (+1.200) to a 54.00 close, while cattle ended at 101.325 with a 1.950 decrease (-1.9%).

World Cup Trading Championships®

In Futures, Michael O’Keeffe has held the top position, based on the end of week standings, for the 15th week in a row with a 487% net return. Orhan Özcan held the 2nd spot with a net return of 288.5%. Yuwen Cao maintained 3rd with a net return of 211%. Stefan Seibert and Tim Hall rounded out the top 5 with net returns of 199.3% and 196.3% respectively.

In the Forex division, Raul Glavan held first at 106.8%, with Jan Smolen finishing the week in 2nd with a net return of 101%, followed by Nicholas Ridley at 97.9% net. Patrick Nill and Scott Welsh rounded out the top 5 with net returns of 72.4% and 47.1% respectively.

In the futures division of the 2020-2021 Global Cup Trading Championship, Jan Smolen has taken first with a net return of 39.2%, with Stefan Seibert following closely at 39.1%.  3rd place is currently held by M. Vontobel (Tirutrade AG) with a net return of 27.8%. Tobias Baerlin and Wayne Wan are in 4th and 5th at 21% and 18.7% respectively.

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