Stocks

US stocks recover but fall for the seventh week in a row.

Markets:

The S&P 500 fell for the seventh week in a row, the longest streak since 2001. The longest streaks ever were 8 weeks in 2001 and 1970.

At the moment, there is a lot of emphasis on stocks. The S&P 500 opened higher, then fell more than 2% at the lows before recovering late in the day to finish fractionally higher.

It’s worth noting that the correlation with FX has weakened.

Today, the dollar was generally weaker, while yen crosses were mostly higher. This is a departure from the recent trend.

Bonds are also taking on a new tone, with yields falling for the second week in a row. That may reflect risk aversion, but it at least suggests that deleveraging has run its course, at least for the time being.

Oil

• Oil gains another daily and weekly gain.
• Gains for four weeks in a row
• The June oil contract closed today at $113.23, up $1.02 from the previous day.
• The volume and speculative trading are now all in July, but it was also higher, up $43 cents to $110.23.
• If you had one of the worst stretches in stock history, combined with widespread economic anxiety, you’d expect oil to underperform. Instead, it has not only outperformed, but also gained. Oil has risen 10% in the last four weeks. This is the first time the market has closed above $110 since March 25. There is now talk of Shanghai reopening, and stocks must at some point recover.
• It’s becoming increasingly clear that there simply isn’t enough supply. I’m concerned about how high prices could go, especially if Russia loses 3 million barrels per day as predicted. The problem for the larger market is that oil spending is consuming a larger portion of the budget. This is data from JPMorgan Chase. Since April 26, gasoline prices have risen every day.

S&P

• The S&P index has entered bear market territory; it is trading at less than -20% of its all-time high; and it has reached a new low of 3841.54. In the process, it removed the previous week’s low price of 3858.87.
• The index was down 20.28 percent from its all-time high and 2022 high on January 4. This moves the index into “bear market territory.” A 20% decline is considered a bear market in financial terms. The NASDAQ index has also set a new daily low of 11166.95. That is still higher than the previous week’s low of 11108.76. Since April 22, the NASDAQ index has been in a bear market (20 trading days)
• It had previously fallen below the -20 percent level on February 23, but had risen above it again on March 7. The index broke out of bear market territory on March 16 and remained there until April 22, when sellers took over again (and the bear market intensified).

European indices

• European major indices close higher on the day
• Most indices have had an up and down week
• The major European indices are ending the day with gains:
• German DAX, up 0.72 percent.
• +0.20 percent for France’s CAC
• The FTSE 100 in the United Kingdom increased by 1.19 percent.
• Ibex +0.93 percent in Spain
• The FTSE MIB in Italy is up 0.12 percent.
• The major indices experienced choppy price action this week:
• The German DAX hit a low of 13683.59 on Thursday and a high of 14226.47 on Wednesday. Last Friday, the index closed at 14027.92. Today’s closing price was 13981.92
• The CAC in France hit a low of 6196.19 on Thursday and a high of 6455.80 on Wednesday. Last Friday, the index closed at 6362.69, and today it closed at 6285.25.
• The FTSE 100 in the United Kingdom fell to 7228.67 on Thursday and rose to 7538.68 on Tuesday. The index closed at 7418.16 last Friday and is now at 7389.99 today.

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