It was a bullish month for equities, SPX +93pts (2.2%) to 4297, with the Nasdaq comp’ +755pts (5.5%) to 14503. WTIC settled +$7.18 (10.8%) to $73.47. Copper cooled by -39cents (8.3%) to $4.29. The USD settled +244bps to DXY 92.43. The US 10yr yield declined by -13bps to 1.45%.
SPX, monthly
Nasdaq comp’, monthly
WTIC, monthly
Copper, monthly
USD, monthly
US 10yr yield, monthly
Summary
Equities: new historic highs for the SPX and Nasdaq comp’… reflective of the broader market. You can argue we’re overbought, but such conditions can last a very long time… even spanning multiple years. The m/t trend has to be seen as bullish. I’d note the monthly 10MA for the SPX at 3819, and that will jump/adjust at the Thursday July 1st open into the low 3900s.
Commodities: oil climbed for the seventh month of eight, breaking a new cycle high of $74.45. Things turn ‘real interesting’ with any price action >77.00 (to be decisive), which would offer open air to giant psy’ $100. Copper saw some powerful cooling, but settling above key price threshold of psy’ $4.00.
USD: June saw a rather strong gain of +2.7% to the mid DXY 92s… a notable close above the key 10MA. Momentum ticked upward, and will be prone to turning positive late July/early August. A loss of the critical 88s still appears an eventuality, but I’d acknowledge, its still a case of the ‘least dirty shirt in the FIAT basket’.
Bonds/yields: the third consecutive net monthly decline in yields. Price structure is still a valid bull flag. Monthly momentum ticked lower for the first time since April 2020, but remains distinctly positive. Its difficult not to see renewed upside, with a natural target of 2.25%.
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Looking ahead
Thursday will see weekly jobs, PMI/ISM manu’, construction, vehicle sales
Earnings: WBA, AYI
Event: OPEC+ will be meeting, and that will clearly have some impact on the energy market.
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Final note
I watched a considerable amount (arguably too much) on C19 last evening. There is some seriously important data – from Pfizer and Israel, but I’ll save it for another time.
I’ll merely wrap up by saying… the second half of the year should be more ‘dynamic’ than the first, and who doesn’t like some market drama?
I have to see energy as the most straight forward trade/investment, as demand is increasing, whilst supply should remain pretty tight.
I’ll endeavour to cover some other issues this Friday/weekend.
Goodnight from London
Yours… tired