Month Gone By – Markets (period ended May 31, 2021)
S&P 500 recorded a close of 4204 on May 28th witnessing a m-o-m increase of 0.54%. The
jobs growth data was a huge disappointment with hardly 2,66,000 jobs added against a broad
consensus of 1,000,000. Following the development, the S&P 500 plummeted from 4232.6 to
4063.04 in a matter of three trading sessions before the markets finally started inching upwards.
The U.S. Department of Commerce’s 2nd estimate for Q1’21 GDP (the broadest measure of
goods and services produced across the economy) was unchanged from the advance estimate
of 6.4%.With the inflation coming in at 4.2% vs 2.6% in the previous month, investor concerns
could be seen be rolling into yields with spikes uto 1.70% before closing the month at 1.60%,
Gold increasing by $100/oz. thereon to close the month at $1906/oz. Also, the comments in
FOMC minutes released on May 19th hinting towards tapering of asset purchase program as the
economy progresses lead to a spike in yields before closing for the month at 1.60%.
The Bloomberg Commodity Index which records an increase across various commodities recorded
an increase from 90.36 on April 30th to 94.14 on May 31st, reflecting an increase in prices of
crude and various industrial metals.
The cryptocurrencies witnessed the roughest month with value of Bitcoin and other cryptos
freefalling to over 40% of monthly highs on the back of negative comments by Elon Musk,
crackdown by China and profit booking by traders.
The INR moderated from 74.05 on April 30th to 72.51 on May 31st as DXY (the index which
measures dollar strength against a basket of currencies) fell from 91.28 on April-end to 89.81 on
May 31st indicating a weakening in the greenback.