Weekly Market Recap – November 4, 2022
Russia’s President Putin suspended the Ukraine grain export deal, only to reverse his position a few days later, causing a volatile whipsaw in international wheat prices.
Saudi Aramco, the largest oil company in the world, announced a record quarterly net profit of $42 billion, more than double what Exxon Mobil earned during the same period.
The Fed hiked interest rates again, making it the fourth uptick in a row. The 0.75 percent increase was then matched with the same incremental rise by the ECB, as both central banks kept pursuing their respective inflation control policies. Elon Musk has now fired nearly half of Twitter’s employees.
Monthly economic statistics reported during the week were: international trade balance (deficit) -$73.3 billion vs. -$65.7 billion, Chicago PMI 45.2 vs. 45.7, job openings 10.7 million vs. 10.3 million, job quits 4.1 million vs. 4.2 million, construction spending +0.2% vs. -0.6%, motor vehicle sales 15.8 million vs. 13.7 million, factory orders +0.3% vs. +0.2%, nonfarm payrolls 261,000 vs. 315,000 and the unemployment rate was 3.7% vs. 3.5%. The weekly job numbers showed that initial jobless claims fell to 217,000 from the previous 218,000, and continuing claims rose to 1.49 million from 1.44 million. Quarterly stats showed that productivity rose 0.3% in Q3 vs. -4.1% in Q2, and that unit labor costs in Q3 were up 3.5% compared with the prior quarter’s 8.9% rise.
Despite the stock market strength on Monday and Tuesday, the sizzle faded and the indices we track here all ended the week lower than closing numbers from the previous Friday. The Dow Jones Industrial Average closed at 32,403.22 (-1.4%), the S&P 500 gave back 3.3% to close at 3,770.55, and the NASDAQ Composite went out at 10,475.25 (-5.6%). Volatility subsided, reducing CBOE’s VIX to 24.55 (-4.7%). In currencies, U.S. Dollar Index futures remained steady, closing the week at 110.774 (+0.2%). The commodity sector firmed, as per S&P’s GSCI; the portfolio of futures rose to 665.94 (+4.6%).
Metals sector futures were mostly higher. In the contracts we monitor, closing prices and percentage movements were as follows: gold at $1,676.60 per ounce (+1.9%), silver at $20.784 (+8.5%), platinum at $960.50 (+1.2%), palladium at $1,839.50 (-3.0%), copper at $3.6865 per pound (+7,5%) and aluminum at $2,355.50 per metric ton (+6.5%).
On the energy charts, the futures contracts on our watch list all barreled ahead, except for one, the ICE TTF Dutch gas. That market dropped in price because supplies of imported LNG from Russia to Europe have soared to record highs. TTF plunged 17.6% for the week, going out at €114.786 per MWh. Settlement prices and percentage increases for rest of the energy sector we follow were: WTI crude at $92.61 per barrel, up 5.4%, Brent crude at $98.57 (+5.1%), heating oil at $3.4578 per gallon (+ 4.5%), RBOB gasoline at $2.7348 (+6.7%) and NYMEX natural gas at $6.400 per mmBtu (+12.6%).
Of the nine agricultural futures on our radar, seven increased and two decreased. The gainers were: soybeans at $14.69 (+4.3%), corn at $6.81 (+0.04%), wheat at $8.47¾ (+2.2%), coffee at $1.7575 (+3.5%), sugar at 18.71¢ (+6.4%), cocoa at $2,434 (+5.7%) and cotton at 86.93¢ (+20.6%). The livestock sector fell into the red, with cattle at 151.650 (-.9%) and lean hogs at 82.975 (-3.6%).
Futures Referenced in Market Recap
| Exchange | Commodity | Contract Month |
|---|---|---|
| CME | Live Cattle | December |
| CME | Lean Hogs | December |
| CBT | Soybeans | March |
| CBT | Corn | December |
| CBT | Wheat | December |
| ICE | Coffee | December |
| ICE | Cocoa | December |
| ICE | Sugar | March |
| ICE | Cotton | December |
| ICE | Brent Crude | January |
| ICE | Dutch TTF Gas | December |
| ICE | USD Index | December |
| NYMEX | WTI Crude | December |
| NYMEX | ULSD (Heating Oil) | December |
| NYMEX | RBOB (Gasoline) | December |
| NYMEX | Natural Gas | December |
| NYMEX | Platinum | January |
| NYMEX | Palladium | December |
| COMEX | Gold | December |
| COMEX | Silver | December |
| COMEX | Copper | December |
| LME | Aluminum | 3 Mo. Forward |
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