Weekly Market Recap – June 12, 2020

In the Markets

The week for stock markets started off with a bang as the Monday, Tuesday and Wednesday sessions took the NASDAQ Composite to three consecutive all time highs. By the end of the week, however, the exuberance was gone. Also, the NBER panel reported that the US had entered a recession in February, ending the longest expansion period on record. The Fed indicated that it is committed to continue stimulating the economy damaged by the coronavirus, and has no intention to raise interest rates through to 2022. The pandemic news included the increase of infection that totals more than 2 million confirmed cases and over 113,000 deaths, as both statistics are spiking in several states. New state unemployment claims fell by 1.5 million, indicating that the labor situation is getting worse at a slower rate.

The DJIA fell 1,505.44 (-5.6%), closing at 25,605.54 on Friday. The S&P 500 gave back 152.62 points, ending at 3,041.34 (-4.8%), and the Russell 2000 dropped 7.9% with a 9.53 loss for the week, taking it to 111.33 to at the close. The NASDAQ Composite is now the only one of the four indices we include in this recap that is ahead for the year (+6.9%). Its weekly close of 9,588.81 was due to its 225.27 decline (-2.3%). The sea change for equities traders is evident in the CBOE Volatility Index: it soared 47.2% from the previous Friday as the VIX jumped 11.57 points to 36.09 – its greatest one week move since the end of February when the crash began.

The yellow metal returned to its status as the leader the precious sector, as August gold rose by $61.10 (+3.6%) to $1,737.30 at Friday\\\’s close. Silver squeaked out a $0.003 uptick to $17.482 that was statistically unchanged for the week. Platinum lost $11.40 (-1.4%) to $819.00 and palladium moved lower by $14.10 (-0.7%) to $1,938.50 per troy ounce. Base metals were slightly mixed, as CME copper gained 4.45¢ (+1.7%) settling at $2.6000 per pound. LME aluminum ended the week at $1,585/ton, a decline of $6.50 (-0.4%).

CME Crude oil prices booked their first negative week in two months as July WTI ended Friday\\\’s session at $36.26, which was down $3.29 (-8.3%). In a similar move, ICE Brent declined 8.4%, losing $3.57 to settle at $38.73 per barrel. Refined products retreated, as well. July heating oil lost 4.92 cents to close at $1.1014 (-4.3%), while RBOB gasoline lost 8.94 cents, settling at $1.1243 (-7.4%). Natural gas hit contract lows on Wednesday ($1.674) bouncing a bit to end the week at $1.731 per MMBtu. The percentage move was a 2.9% loss for the week and a 24.8% loss year-to-date.

Agricultural commodities, although comprising only 24% of the S&P GSCI, are under much more duress than the metals and energy in the index. According to Goldman Sachs, the corn and sugar crop expectations are for unusually high production levels, even as pandemic related disruptions impact the demand forecasts. Soybeans rose 3½¢ last week (+0.4%) to close at $8.7125 per bushel. The July corn contract decreased 1¼¢ (-0.4%) to a $3.300 settlement price. Wheat dropped 13¼¢ (-2,6%) ending at $5.0200 for the week. The spread between the ICE coffee contracts has narrowed a bit: Robusta decreased by 4.2%, while Arabica eased 3.7%, settling at $1,181 per metric ton and $95.20 per pound, respectively. Sugar corrected, somewhat, dipping below 12¢, as July gave back 0.15 points (-1.2%), closing at 11.87¢/pound. Cocoa had a very slight decline, settling at 2,396 (-0.1%), off 2 points. Cotton lost 1.95 (-3.2%) to 59.84 in the July contract. FCOJ settled at 122.85 after retreating 4.70 (-3.7%). Milk was down 13 points (-0.7%), closing at 18.54 for the week. Livestock firmed as June hogs rose 1.3% (+0.60) to a 48.050 close, while cattle ended at 96.075 for June, with a 2.18 rise (+2.3%).

World Cup Trading Championships®

In Futures, Michael O’Keeffe has held the top position, based on the end of week standings, for the 9th week in a row with a 778.1% net return. Tim Hall maintained the 2nd spot with a net return of 283.7%. Yuwen Cao remained in 3rd with a net return of 244.4%. Stefan Seibert and Stefano Serafini rounded out the top 5 with net returns of 189.9% and 181.6% respectively.

In the Forex division, Raul Glavan moved up to first at 112% with Scott Welsh finishing the week in 2nd with a net return of 63.1%, followed by Nicholas Ridley at 60.4% net. Adrian Koemel and Jan Smolen rounded out the top 5 with net returns of 47.6% and 46.9% respectively.

(Through May 29 – Final Results Pending Audit) The Top 5 Global Cup Finalists are Stefan Seibert in 1st at 210.7% net, Michael Cook in 2nd at 171.7% net, Maxim Schulz in 3rd at 156.2%, Robert Miner in 4th at 134.4%, and Wayne Wan in 5th at 113.2% net.

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.