Weekly Market Recap – May 14, 2021
The number of Americans seeking unemployment benefits dropped again: 473,000 initial jobless claims were filed, compared with 507,000 the previous week. The federal budget for April showed a $226 billion deficit vs. $738 billion in March. Other economic statistics, compared with their prior level were as follows: April retail sales had 0.0% change (vs. +10.7% in March), industrial production +0.7% (vs. +2.4%), capacity utilization is at 74.9% (vs. 74.4%), March business inventories were +0.3% (vs. +0.6% in February). However, the headline stats were the two major price indices that carried inflationary implications. Producer prices were up 1.0% vs. the prior month’s 0.5% increase. That rise was twice the level that Wall Street economists expected. Consumer prices jumped 0.8% for April, the highest monthly jump in over a decade.
Coinciding with the abovementioned inflation pressures, stock market indices took a breather from their month-long rallies, easing a few percentage points. For the week, the DJIA slipped 1.1% to 34,382.13, the S&P 500 decreased 1.4% to 4,173.85, and the NASDAQ Composite went out at 13,429.98 with its 2.3% slide. Volatility returned to the exchanges and nudged CBOE’s VIX to pop up 12.7%, ending at 18.81 on Friday. The U.S. Dollar Index was stable, closing the week at 90.30 (+0.1%). The portfolio of commodities in S&P’s GSCI had the first down week in over a month, dropping 1.5% with a 514.99 final print.
Five of the six metal futures we focus on in our recap moved lower. Only gold crept into the plus column by 0.4% for the week, with its $1,838.10 settlement. The weaker contracts in the group closed as follows: silver at $27.365 (-0.4%), platinum at $1,222.80 (-2.5%), palladium at $2,894.60 (-1.0%), copper at $4.6545 (-2.0%) and aluminum at $2,463.00 (-3.0%).
Energy futures held their ground, but barely so: NYMEX WTI added 0.7% to $65.37 per barrel. Likewise, Brent crude increased 0.6%, ending at $68.71 on Friday. U.S. refined products corrected from Monday’s panic spike (in response to the Colonial pipeline hack), as heating oil ended 1.3% higher, closing the week at $2.0362, and RBOB gasoline had a 0.0% change, settling at $2.1266 per gallon. Natural gas inched higher, firming by 0.1%, taking the June futures to $2.961 per mmBtu.
Of the nine agricultural markets that we review, eight of the products were in the red for the week. In percentage terms, corn fared the worst: the July contract plunged 12.1% with an 88½¢ crash to $6.43¾ per bushel. Wheat gave back 54½ ¢ (-7.2%) to its $7.07¼ settlement, and soybeans closed at $15.86½ (-0.2%). Coffee pulled back 5.2%, with the July ICE futures ending the week at $1.45 per pound. Sugar lost 3.0%, settling at 16.96¢/lb. Cotton took an 8.1% hit: as the July contract closed at 82.43¢ per pound. In the livestock markets, hogs fell to 108.725 (-3.7%), while cattle futures shaved off 0.6%, and closed with a price of 115.300 at week’s end. Cocoa was the gainer, but only by eleven ticks (+0.4%) to $2,474 per metric ton.
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.