Weekly Market Recap – September 24, 2021
Monday saw the biggest drop in the stock market since May. The waves of selling were in response to reports from rating agencies that “default appears probable” for Chinese property giant Evergrande, which is saddled with $300 billion in debt. Another source of pressure on the markets was referenced to Treasury Secretary Yellin’s warning that the U.S. could default on its debt in October if Congress doesn’t act to raise the limit. By Friday’s close, investors had driven the market indices back up, erasing the week’s losses. Some analysts attributed the optimism to signs that the $1 trillion infrastructure bill was gaining traction in Washington.
Monthly economic statistics compared with previous values were: Housing starts 1.62 million vs. 1.55 million, building permits 1.73 million vs. 1.63 million, existing home sales 5.88 million vs. 6.0 million, New home sales 740,000 vs. 729,000, and the index of leading economic indicators 0.9% vs. 0.8%. Real household wealth for Q2 was up 9.2% vs. +12.4%, and Q2 real domestic non-financial debt fell 1.7% vs. +3.0%. Weekly initial jobless claims were 351,000 vs. 335,000.
In the aftermath of the above-mentioned stock plunge on Monday, the indices we track here squeaked their way back on track to close minimally higher for the week. The Dow Jones Industrial Average rose 0.6% to 34,798.00, the S&P 500 ended at 4,455.48 (+0.5%), and the NASDAQ Composite had a slight increase to 15,047.70 (+0.02%). CBOE’s VIX, having spiked to 28.79 on Monday, ended the week at 17.75 (-14.7%). The U.S. Dollar Index finished at 93.27 (+0.03%). Commodity prices firmed 2.0%, as evidenced by the S&P GSCI, settled at 549.72 on Friday.
In metals futures, the contracts on our radar were mostly higher. The settlements and corresponding percentage movements were: gold at $1,751.70 (+0.02%), silver at $22.425 (+0.4%), platinum at $979.90 (+5.3%), palladium at $1,951.10 (-1.6%), copper at $4.2855 (+0.9%), and aluminum at $2,915.50 (+1.0%).
Energy markets maintained strength from the prior week. NYMEX WTI advanced to $73.98 per barrel, up 3.0%. ICE Brent rallied to 78.09 (+3.7%). U.S. refined products also rose: heating oil gained 2.6%, closing the week at $2.2671, and RBOB gasoline added 0.7% to $2.1875 per gallon. Natural gas went out at $5.140 per mmBtu (+0.7%).
Six of the nine agricultural products we report moved higher and three of them decreased. The gainers were: soybeans at $12.85 (+0.1%), wheat at $7.23¾ (+2.1%), coffee at $1.9435 (+4.3%), cotton at 95.99¢ (+4.0%), live cattle at 122.925 (+0.1%), and lean hogs, closing at 87.275 (+1.8%). The negative moves were in corn at $5.26¾ (-0.1%), sugar at 19.10¢ (-0.4%), and cocoa at $2,591 (-2.8%).
Futures Referenced in Market Recap
|NYMEX||ULSD (Heating Oil)||October|
|LME||Aluminum||3 Mo. Forward|
2021 World Cup Championship of Futures Trading®
|1||Kevin S McCormick||253.8%|
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