Weekly Excerpt 07/06/2021
Weekly Summary from May 31 to June 04
- The US equity market closed the week in positive territory. The S&P500 closed very close to setting a new all-time high. The best performing sector for the week was the energy sector, up 6,75%. On the other hand, the worst performing sector was consumer discretionary, down -1,22%. The Dow Jones led the rally of the major indices with a gain of 0.85%.
- In Europe, the week closed positively for the main equity indices with the exception of the Ibex 35, which saw its positive streak of several consecutive weeks closing in the green halted. The energy sector has led the index's falls after the Spanish government presented a package of measures that could lead to a radical change in the wholesale electricity market.
- The market has taken a positive view of the new job creation data. The number of jobs created in the month of May was 559,000 (675,000 estimated), which has shown a significant rebound from April. This rise may increase investor confidence in the recovery of the economy. On the other hand, it is understood that the recovery is not as rapid as some had expected, which could reduce the risk of a rapid interest rate hike.
- Oil maintains its rally supported by the policies implemented by OPEC+ to control pumping and recover demand. Brent has managed to break above USD 72 for the first time since 2019 and WTI is at the highest prices since October 2018.
- The finance ministers of the world's richest countries, the G7 Group, have reached a historic agreement on the creation of a global minimum tax of 15% for corporations. The idea is to prevent multinational companies from relocating their operations to countries where taxes are lower. The minimum tax would apply to profits generated abroad and would not affect local tax rates set by each government.
| AMERICA | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| DOW JONES | 34.756,39 | 0,85% | 13,50% |
| S&P500 | 4.229,89 | 0,69% | 12,57% |
| NASDAQ | 13.814,49 | 0,57% | 7,12% |
| EUROPE | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| Euro Stoxx 50 | 4.089,38 | 0,46% | 15,11% |
| FTSE 100 | 7.069,04 | 0,70% | 9,42% |
| CAC 40 | 6.515,66 | 0,49% | 17,37% |
| DAX | 15.692,90 | 1,11% | 14,39% |
| IBEX 35 | 9.088,30 | -1,48% | 12,57% |
| SMI | 11.570,68 | 1,26% | 8,10% |
| ASIA | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| NIKKEI 225 | 28.941,52 | -0,71% | 5,46% |
| HSI | 28.918,10 | -0,71% | 6,20% |
| CSI 300 | 5.282,28 | -0,73% | 1,36% |
| BONUS | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| US TREASURY 10Y | 1,56 | -2,46% | 89,48% |
| US Generic Govt 2 Yr | 0,15 | 5,71% | -23,35% |
| GERMANY 10 YR | - 0,21 | -16,73% | 33,44% |
| UK 10 Yr | 0,79 | -0,56% | 158,17% |
| COMMODITIES | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| WTI | 69,41 | 3,83% | 43,24% |
| BRENT | 71,67 | 2,93% | 38,55% |
| NATURAL GAS | 3,10 | 4,73% | 21,78% |
| CORN | 681,00 | 2,48% | 40,70% |
| WHEAT | 685,00 | 1,29% | 6,95% |
| GOLD $/oz | 1.891,40 | -0,23% | -0,20% |
| SILVER $/Oz | 27,90 | -0,16% | 5,61% |
| COPPER | 452,20 | -3,02% | 28,49% |
| PLATINUM | 1.168,60 | -1,34% | 8,98% |
| COINS | VALUE | Δ %5 Days | Δ % YTD |
|---|---|---|---|
| EURUSD | 1,217 | -0,19% | -0,41% |
| AUDUSD | 0,774 | 0,41% | 0,64% |
| CADUSD | 0,828 | -0,01% | -5,19% |
| CHFUSD | 1,113 | 0,12% | 1,64% |
| GBPUSD | 1,416 | -0,17% | 3,61% |
| CNYUSD | 0,156 | -0,41% | -2,02% |
| JPYUSD | 0,009 | 0,32% | 6,04% |
| USDBRL | 5,041 | -3,79% | 3,07% |
| USDMXN | 19,946 | 0,04% | -0,07% |
| USDCOP | 3599,98 | -2,89% | -4,73% |
| XBTUSD | 36949,63 | 4,90% | 28,07% |
To keep in mind during the week
- On Sunday, June 6, U.S. Treasury Secretary Janet Yellen has mentioned that it would be good if President Biden could go ahead with his $4 trillion spending program, further that this could be a catalyst for higher inflation leading to higher interest rates.
- As investors' attention remains focused on gaining more certainty about inflation, the focus will be on the Consumer Price Index (CPI) data due out on Thursday, June 10. Much higher than expected data could ultimately lead to further monetary policy action by the Federal Reserve.
- The negotiation between the Democratic Party and Republicans regarding the passage of President Joe Biden's proposed $1.7 trillion infrastructure package will be closely watched by investors. A delay in the passage of the package or a major change in the size of the package could leave some sectors of the economy vulnerable.
- The Group of Seven (G7) finance ministers have agreed to a minimum corporate tax rate of 15% for large companies. This landmark agreement could help countries collect more taxes from large corporations and allow governments to levy taxes on U.S. tech giants like Amazon and Facebook.
- Tesla, the electric vehicle company, announced on Sunday, June 6, that it is canceling production of its Model S Plaid+ vehicle. This model would have represented the company's top-of-the-line vehicle. According to Elon Musk, the company's CEO, it is not necessary to produce this new car because the previous model "Plaid" is already too good.
- In Europe, all attention will be on the European Central Bank's meeting on Thursday, June 10, where it will release its updated growth projections for 2021 and 2022. Inflation data for the month of May in the euro zone reached its highest levels since 2018. Against this backdrop, the central bank will have to define whether to maintain power or taper its emergency pandemic purchase program (PEPP) to some extent.
- In the UK, the plan for a full reopening of the economy on June 21 is in greater doubt due to concerns about the new "delta" variant of COVID-19. In light of this, investors will be paying close attention to Friday's monthly GDP growth figures.
- The market is going to keep a close eye on China's trade balance data. It is expected to know whether China's huge surplus could start to shrink and thus slow down the yuan's rally. In the month of May, the currency had managed to reach its highest level in three years against the dollar.
- Bitcoin and most major cryptocurrencies fell over the weekend on concerns that there may be a further crackdown on the industry in China. A report from Goldman Sachs Group Inc. mentions that institutional adoption may be a long process.
- Amazon founder Jeff Bezoz announced today that he and his brother Mark will fly on the first manned space flight of their rocket company Blue Origin on July 20 of this year.
Corporate Calendar
Before market opening
