Covid Spares No One...
Updated: Oct 5, 2020
Last week was split in two parts; a relentless four-days short covering rally fueled by expectations of a fiscal breakthrough, followed by a selloff on Friday as D. Trump announced he had turned covid positive. The reaction was muted however, considering that it was accompanied by a weaker than expected US job report on Friday and further crude oil prices weakness.
Last Week's recap...
Over the past week, the S&P500 gained 1,6% (3,7% YTD) while the Nasdaq100 gained 1,0% (29,0% YTD). The US small cap index rallied 4,4% (-7,7% YTD).
CBOE Volatility Index rallied 4,7% (100,5% YTD) to 27,63.
The Eurostoxx50 gained 1,8% (-12,7%), outperforming the S&P500 by 0,2%.
Diversified EM equities (VWO) rallied 2,3% (-3,0%), outperforming the S&P500 by 0,8%.
The Dollar DXY Index (UUP) measuring the USD performance vs. other G7 currencies dropped -0,7% (-2,3%) while the MSCI EM currency index (measuring the performance of EM currencies vs. the USD) gained 0,5% (-1,8%).
10Y US Treasuries dropped 5bps (-122bps) to 0,70%. 10Y Bunds dropped -1bps (-35bps) to -0,54%. 10Y Italian BTPs rallied -10bps (-63bps) to 0,78%, outperforming Bunds by -4bps.
US High Yield (HY) Average Spread over Treasuries dropped -27bps (174bps) to 5,10%. US Investment Grade Average OAS dropped -6bps (43bps) to 1,44%.
In European credit markets, EUR 5Y Senior Financial Spread dropped -5bps (25bps) to 0,77%.
Gold rallied 2,1% (25,2%) while Silver rallied 3,7% (33,0%). Major Gold Mines (GDX) gained 1,4% (33,1%).
Goldman Sachs Commodity Index sold off by -3,7% (-31,5%). WTI Crude sold off by -8,0% (-39,3%).
Have a nice week ahead and stay safe.
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Marc Bentin, BentinPartner GmbH
Founder, Chief Investment Officer
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