Weekly Market Recap – June 2, 2023

Finally, after weeks of legislative stalemate, bipartisan negotiations on the debt ceiling broke the impasse. They pulled the U.S. back from the brink of an economic disaster that would have also sparked unknown global consequences. At week’s end, President Biden was finally able to sign the bill.

Monthly economic statistics reported during the week compared with prior levels were: S&P Case-Shiller home price index (year over year) -1.1% vs. +0.4%, construction spending +1.2% vs. +0.3%, consumer confidence index 102.3 vs. 103.7, job openings 10.1 million vs. 9.7 million, nonfarm payrolls rose 339,000 vs. +294,000, the unemployment rate increased to 3.7% from 3.4%. Weekly jobless filings showed initial claims rose to 232,000 from 230,000 the previous week. There was one major quarterly statistic revision released: Q1 productivity was -2.1% vs. -1.6% in Q4.

As the showdown by U.S. lawmakers inched toward compromise, Wall Street buying gathered steam. The DJIA closed the week up 2.0% and ended at 33,762.76, its highest level in a month. The S&P 500 finished at 4,282.37 (+1.8%), its highest in 22 months. The NASDAQ Composite went out at 13,240.77 (+2.0%), its highest settlement in 26 months. CBOE’s VIX collapsed 18.7%, marking 14.60 at the bell; the “fear index” had not seen such a low level since February 2020, the week before the pandemic first rattled the capital markets. In currencies, the USD Index lost 0.2%, with the futures ending at 103.952 on Friday. Commodities in the S&P GSCI portfolio of futures showed little movement (-0.2%) easing the index to 545.57 at the week’s end.

The metals futures contracts we monitor were mixed. Settlements and weekly percentage changes were: gold at $1,969.60 (+0.3%), silver at $23.747 (+1.7%), platinum at $1,003.50 (-2.4%), palladium at $1,403.50 (-1.6%), copper at $3.7275 (+1.2%) and aluminum at $2,263.50 (+1.2%).

On the energy charts, most of the futures contracts we watch booked losses for the week. Settlement prices and percentage moves for the six markets we follow in this sector were: WTI crude at $71.74 per barrel (-1.3%), Brent crude at $76.13 (-1.1%), heating oil at $2.3569 per gallon (+0.1%), RBOB gasoline at $2.5007 (-3.5%), NYMEX natural gas at $2.172 per MMBtu (-10.1%) and ICE Dutch gas fell 5.4%, going out at €23.689 per MWh.

For the agricultural commodities on our radar, the bulls dominated the bears. Friday settlement results for the contracts we monitor in this category were: soybeans at $13.52½ (+1.1%), corn at $6.09 (+0.8%), wheat at $6.19 (+0.5%), coffee at $1.8030 (-0.7%), sugar at 24.73¢ (-2.5%), cocoa at $3,026 (+1.2%), cotton at 86.05¢ (+3.2%), live cattle at 176.425 (+5.4%) and lean hogs at 86.725 (+14.0%).

Futures Referenced in Market Recap

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