Weekly Market Recap – October 16, 2020
In the Markets
Coronavirus cases are surging in Europe, and with the weather cooling, the US braces for a new wave of infections. At least nine states are reporting record numbers of new cases, and thirteen states have positivity rates in excess of 10%. The Labor Department reported 898,000 new jobless claims, the highest since mid August. The total number of workers receiving unemployment (federal and state) benefits is 25.3 million. Retail sales for September rose 1.9%, as consumers bought vehicles, clothing and sporting goods. Industrial production was down 0.6%. On Friday, the Treasury Department reported a $3.1 trillion budget deficit for the fiscal year ending September 30th. This gap, as a percentage of economic output, was 16.1%, the largest since 1945, when the US was financing the costs of World War II.
NOAA reported that September 2020 was the warmest September on record since the recording of global temperature began in 1880. The California Department of Forestry and Fire Protection reported that more than 4 million acres of forested land have been destroyed so far this fire season, a greater amount of acreage than the state of Connecticut. The stimulus standoff remains unresolved. Early voting for the national election is breaking records. More than 22 million people have already cast ballots, 19% of the total who voted in 2016.
The DJIA inched up 19.41 (+0.1%), closing at 28,606.31 on Friday. The S&P 500 added a mere 6.68 points, ending at 3,483.81 (+0.2%), and the NASDAQ Composite marked a 0.8% rise, up 91.62 for the week to 11,671.56 at the close. Of the indices we include in this recap, only the Russell 2000 is having a negative year-to-date move, though barely (-1.5%). For the weekly change, it slipped 0.26 points (-0.2%) ending at 131.13 on Friday. The CBOE Volatility index closed at 27.41, up 9.6%. In global currency markets, the US dollar firmed slightly; the spot Dollar Index gained 0.7% (+0.66 points) ending at 93.72 on Friday. In the commodity segment of the financial markets, the S&P GSCI gained only a bit more ground (+0.6%), adding 2.03 to its 362.60 final print of the week, its highest Friday settlement since February 21st.
The metals sector moved mostly lower, as gold futures shed $19.80 (-1.0%), ending at $1,906.40 per troy ounce. Silver decreased $0.703 (-2.8%) to its $24.405 settlement price. Platinum and palladium suffered selloffs, as well. The former fell $25.00 (-2.8%) to its $869.30 close, while the latter dropped to $2,342.30 (-4.9%) with a loss of $120.90 in the December contract. The base metals that we cover in our recap were mixed. Copper eased 1.68¢ (-0.5%) to close at $3.0657 per pound. LME aluminum for 3-month delivery moved to the plus side by $29.00 dollars per ton, ending at $1,870.50 (+1.6%), a 17-month high. Aluminum demand from China has been robust by the transportation, construction and packaging industries.
Crude oil prices nudged a bit higher during the week. November WTI closed at $40.88, which was up 28¢ (+0.7%). ICE Brent was up 0.2%, adding 8¢ to settle at $42.93 per barrel. Refined products took the opposite tack, with heating oil losing 1.42¢ to close at $1.1791 (-1.2%), while RBOB gasoline retreated 3.44¢ per gallon, settling at $1.1688 (-2.9%). Natural gas was higher for the week, up 3.2¢ (+1.2%), ending at $2.773 per MMBtu.
The agricultural commodity markets covered in this recap were mixed. Soybeans corrected 15½ ¢ (-1.5%) to close at $10.50 per bushel. The December corn contract rose 7¢ (+1.8%) to a $4.02 settlement price. Wheat advanced 8½ ¢ (+1.4%) ending at $6.02¼ for the week. On the ICE US, coffee ticked down 4.30 on the week (-3.9%), settling at $1.0725 per pound. Sugar improved again, rising 0.20 (+1.4%) closing at 14.43, the highest end of week value since February 26th. Cocoa had a $71 setback, settling at $2,361 (-2.9%). Cotton keeps marching upward, as it rallied 2.28¢ (+3.4%) to 69.92 in the December contract, its highest end of week close since late January. Livestock prices diverged. Hogs continued making highs as prices firmed again, gaining 2.675 (+4.0%) to a 69.800 settlement, the highest weekly close for the year in the December contract. Cattle ended at 108.625, after a 3.975 dive (-3.5%), possibly attributed to weak beef export reports from the USDA.
World Cup Trading Championships®
In Futures, Stefan Seibert climbed to first with a net return of 347.6%, taking the spot from Michael O’Keeffe who has held the top position for the past 26 weeks and now has a 347.1% net return. Yuwen Cao remained in 3rd with a net return of 248.1%. Paige Williams and Evgeny Kartashov rounded out the top 5 with net returns of 209.5% and 165.8% respectively.
In the Forex division, Patrick Nill held the top spot with a 245.6% net return. Raul Glavan remained in 2nd at 154.2% net return, with Jan Smolen in 3rd with a net return of 104.2%. Sergey Shirko and Scott Welsh rounded out the top 5 with net returns of 93.8% and 81.3% respectively.
In the futures division of the 2020-2021 Global Cup Trading Championship, Stefan Seibert maintained first with a net return of 148.8%, with M. Vontobel of Tirutrade AG in 2nd with a 108.9% net return. 3rd place is currently held by Tobias Baerlin with a net return of 73.7%. Adrian Koemel and Fernando C. Piñeiro finished the week in 4th and 5th with 59.1% and 37.3% net returns respectively.
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