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Crude Oil and Natural Gas Futures Rose, SPY Fell

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S&P 500’s performance  

The S&P 500 Index fell ~0.4% to 2,775.63 on June 13. The Fed increased US interest rates by 0.25% on June 13, which pressured the S&P 500 Index. Eight out of the ten major sectors in the S&P 500 fell on June 13.

The SPDR S&P 500 ETF (SPY) fell ~0.3% to $278 on June 13. SPY aims to track the performance of the S&P 500 Index. The E-Mini S&P 500 futures rose 0.01% from the previous settlement in early morning trade on June 14.

S&P 500’s sectoral performance

The real estate, materials, and industrials sectors fell 2.2%, 1.1%, and 0.8%, respectively, on June 13. These sectors pressured SPY the most on the day.

The energy sector, which accounts for ~6.2% of the S&P 500 Index, fell 0.4% on June 13. The Energy Select Sector SPDR ETF (XLE) fell ~0.4% to $76.42 on June 13. XLE represents the S&P 500 Index’s energy sector.

Apart from energy stocks directly impacting equity indexes, the sentiments in the commodity and equity markets could impact each other depending on the magnitude of the movements in each market and the various fundamental factors affecting them.

Commodities 

July WTI oil futures contracts rose 0.4% to $66.64 per barrel on June 13—the highest closing since May 31. The prices rose due to the larger-than-expected decline in US crude oil inventories. On June 13, the International Energy Agency reported that global oil demand will grow by 1.4 MMbpd (million barrels per day) in 2019. The expectations of strong oil demand supported oil prices on June 13. The United States Oil ETF (USO) rose 0.5% to $13.47 on June 13. USO aims to track the performance of active WTI oil futures.

July WTI oil futures contracts fell 0.1% from the previous settlement in early morning trade on June 14 due to the expectation of a rise in crude oil production from OPEC and Russia.

July US natural gas futures rose 0.8% to $2.96 per MMBtu (million British thermal units) on June 13—the highest closing since January 31. The prices rose due to the expectation of strong natural gas demand. The United States Natural Gas ETF (UNG) rose 0.7% to $23.95 on June 13. UNG seeks to follow the performance of active natural gas futures.

July US natural gas futures contracts fell 0.3% from the previous settlement in early morning trade on June 14 due to profit-booking.

The iShares S&P GSCI Commodity-Indexed Trust (GSG) rose ~0.5% to $17.5 on June 13. GSG seeks to track an index composed of a diversified group of commodities futures.

In this series 

In this series, we’ll discuss crude oil’s bearish and bullish drivers.

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