Weekly Market Recap – June 11, 2021
The word “Inflation” appeared frequently in Thursday’s financial press, after the May Consumer Price Index was released, showing a 5.0% surge from a year ago, the highest rate since 2008. The month-to-month CPI was +0.6% vs. the 0.8% rise in April. Other economic statistics, compared with their prior levels were as follows: Initial jobless claims were 376,000 vs. 385,000 the prior week, The April balance of trade, reported by the Department of Commerce, indicated that the deficit grew by $68.9 billion vs. the March trade flow of negative $75.0 billion. The federal budget for May showed a $132 billion deficit vs. $399 billion in April. Wholesale inventories improved 0.8%; the previous month’s report was a +1.2% gain. Business formations in May, on a year-over-year basis, rose 69% vs. the prior 110% rise. New consumer credit was unchanged, with a $20 billion increase in April vs. the $20 billion in March, and the monthly consumer sentiment index was 86.4 vs. 82.9 in the previous report.
President Biden embarked on his first international trip since taking office, to attend the G7 summit in the UK, and to meet with Russian President Vladimir Putin in Geneva.
Stock markets were mixed for the week, yet the S&P 500’s Friday close was an all-time high of 4,247.44 (+0.4%). The Dow Jones Industrial Average went out at 34,479.60 (-0,8%), while the NASDAQ Composite strengthened to 14,069.42 (+1.8%). Volatility ebbed by 4.7%, as evidenced by CBOE’s VIX with its 15.65 final valuation on Friday, its lowest close since early February 2020. In the currency market, the greenback nudged upwards as the U.S. Dollar Index popped up 0.4% to 90.51, its highest Friday close in six weeks. The commodity sector was relatively stable, as per the S&P GSCI. The index ended the week at 532.02 (-0.3%), the smallest incremental weekly move in two months.
Metals moved sideway on the charts. Settlements and weekly changes were as follows: gold at $1,879.60 (-0.7%), silver at $28.146 (+0.9%), platinum at $1,151.70 (-1.1%), palladium at $2,780.80 (-2.2%), copper at $4.5375 (+0.2%), and aluminum at $2,464.50 (+0.4%).
Energy commodities were mostly higher for the week. NYMEX WTI crude oil rose 1.9% to $70.91 per barrel, and ICE Brent budged up to $72.69 (+1.1%). U.S. refined product futures were flat-to-down: July heating oil closed at $2.1207 (0.0%), and gasoline slipped 1.1% to $2.1861 per gallon. Natural gas got a boost from the record high temperatures in the Western U.S. NYMEX Henry Hub futures rallied 6.4%, ending at $3.296 per mmBtu, a new high for the July contract.
The agricultural contracts on our tracking list of nine commodities ended the week with a score of 4 up and 5 down. The gainers were: Corn at $6.84½ (+0.3%), cotton traded 1.4% higher closing at 87.00¢ per pound, lean hogs went out at 122.675 (+2.7%), and live cattle at 118.707 (+1.6%). The futures that lost value were: coffee, with a 2.6% slide to 157.45, sugar at 17.54¢ (-1.0%), cocoa at $2,350 per ton (-2.4%), wheat slipped 1.0% for the week, settling at $6.80¾. The greatest percentage drop in the group was for soybeans, diving 4.8% lower to $15.08½ per bushel.
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