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Why the S&P 500 and WTI Crude Oil Rose on June 12

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S&P 500’s performance 

The S&P 500 Index rose ~0.17% to 2,786.85 on June 12 due to a rise in utilities and real estate stocks. On June 12, President Trump and Kim Jong-un had a meeting about denuclearizing the Korean Peninsula. Six out of the ten major sectors in the S&P 500 rose on June 12.

The SPDR S&P 500 ETF (SPY) rose ~0.1% to $278.9 on June 12. SPY aims to track the performance of the S&P 500 Index. The E-Mini S&P 500 futures rose 0.2% from the previous settlement in early morning trade on June 13.

S&P 500’s sectoral performance  

The utilities, real estate, and technology sectors rose 1.2%, 0.6%, and 0.5%, respectively, on June 12. These sectors supported SPY the most on the day.

The energy sector, which accounts for ~6.2% of the S&P 500 Index, fell 0.8% on June 12. The energy sector was the biggest loss among the major S&P 500 sectors. The Energy Select Sector SPDR ETF (XLE) fell ~0.8% to $76.71 on the day. 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 affect each other depending on the magnitude of the movements in each market and the various fundamental factors impacting them.

Commodities

July WTI oil futures contracts rose 0.4% to $66.36 per barrel on June 12. The prices rose due to the expectation of a fall in US crude oil inventories. The United States Oil ETF (USO) rose 0.3% to $13.4 on June 12. USO aims to track the performance of active WTI oil futures.

July WTI oil futures contracts fell 0.5% from the previous settlement in early morning trade on June 13 due to the expectation of a rise in US crude oil production and an unexpected rise in the API’s (American Petroleum Institute) crude oil inventories.

July US natural gas futures fell 0.3% to $2.93 per MMBtu (million British thermal units) on June 12. Prices fell due to the expectation of weak natural gas demand. The United States Natural Gas ETF (UNG) fell 0.2% to $23.79 on the same day. UNG seeks to follow the performance of active natural gas futures.

July US natural gas futures contracts fell 0.4% from the previous settlement in early morning trade on June 13 due to the expectation of weak demand.

The iShares S&P GSCI Commodity-Indexed Trust (GSG) rose ~0.17% to $17.5 on June 12. GSG seeks to track an index composed of a diversified group of commodities futures.

Series overview  

In this series, we’ll discuss the API’s US crude oil and gasoline inventories. We’ll also discuss the US Dollar Index and the Organisation for Economic Cooperation and Development’s crude oil inventories.

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