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Stock Market Outlook for April 30, 2018

Consumer staples in period of seasonal strength, but some sector constituents performing better than others.

 

Real Time Economic Calendar provided by Investing.com.

 

*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities.   As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.

Stocks Entering Period of Seasonal Strength Today:

Gilead Sciences, Inc.  (NASDAQ:GILD) Seasonal Chart

Gilead Sciences, Inc. (NASDAQ:GILD) Seasonal Chart

Ark Restaurants Corp. (NASD:ARKR) Seasonal Chart

Ark Restaurants Corp. (NASD:ARKR) Seasonal Chart

Activision Blizzard, Inc. (NASDAQ:ATVI) Seasonal Chart

Activision Blizzard, Inc. (NASDAQ:ATVI) Seasonal Chart

CenturyTel, Inc.  (NYSE:CTL) Seasonal Chart

CenturyTel, Inc. (NYSE:CTL) Seasonal Chart

Fresh Del Monte Produce (NYSE:FDP) Seasonal Chart

Fresh Del Monte Produce (NYSE:FDP) Seasonal Chart

Innergex Renewable Energy (TSE:INE) Seasonal Chart

Innergex Renewable Energy (TSE:INE) Seasonal Chart

Constellation Brands, Inc.  (NYSE:STZ) Seasonal Chart

Constellation Brands, Inc. (NYSE:STZ) Seasonal Chart

Waste Connections (TSE:WCN) Seasonal Chart

Waste Connections (TSE:WCN) Seasonal Chart

Scripps Networks Interactive Inc. (NASD:SNI) Seasonal Chart

Scripps Networks Interactive Inc. (NASD:SNI) Seasonal Chart

Sienna Senior Living (TSE:SIA) Seasonal Chart

Sienna Senior Living (TSE:SIA) Seasonal Chart

Altria Group, Inc.  (NYSE:MO) Seasonal Chart

Altria Group, Inc. (NYSE:MO) Seasonal Chart

 

 

The Markets

A rather lacklustre day for stocks saw major benchmarks close relatively flat going into the weekend.  The S&P 500 Index added a mere 0.11%, closing approximately at the mid-point between the 20 and 50-day moving averages.  Declining trendline resistance has been a stubborn hurdle on the upside, presenting risks that the triangle pattern resolves to the downside.

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Friday’s session had a risk-off bias with utilities, REITs, and staples topping the leaderboard.  The S&P 500 Utilities Sector index continues to show an intermediate trend of higher-highs and higher-lows, trading within a defined rising trend channel.  The level of the benchmark tested the upper limit of the span at the highs of the session, tacking on gains within a typically strong period for sector constituents.  The threat of higher rates has yet to deter investors in this market segment, suggesting the bet in the market place is that higher rates do not present a significant risk.  Seasonally, the sector tends to reach an important absolute peak around the start of May. 

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Utilities Sector Seasonal Chart

UTILITIES Relative to the S&P 500
UTILITIES Relative to the S&P 500

UTILITIES Monthly Averages

One of the better industry performers on the day was the distillers and vintners, which according to the Dow Jones industry index gained 1.87%, moving to a new all-time high.  In a consumer staples sector that recently touched 52-week lows, the distillers and vintners industry has certainly been a standout.  We originally profiled the industry at the start of April given the favourable recurring fundamental factors that occur around this time of year.  The summer quarters tend to encompass the best earnings for the year for industry constituents as patio season opens and consumers buy more product for those summer events.  As well, the defensive characteristics of the stock present value during the volatile summer months for the broader equity market.  So far this year, wholesale sales of beer, wine, and distilled alcoholic beverages have been trending around one percent above average, presenting a favourable backdrop to this consumer staples sub-sector that is actually growing.  Recent reports from some consumer staple constituents have shown that growth is a concern.  Seasonally, distillers and vintners typically show gains, on average, between April and September.

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http://charts.equityclock.com/seasonal_charts/economic_data/S4248SM144NCEN_seasonal_chart.PNG

Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.88.

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Seasonal charts of companies reporting earnings today:

Affiliated Managers Group, Inc. (AMG) Seasonal Chart AK Steel Holding Corporation (AKS) Seasonal Chart Akamai Technologies, Inc. (AKAM) Seasonal Chart Alexandria Real Estate Equities, Inc. (ARE) Seasonal Chart Allergan plc. (AGN) Seasonal Chart Allison Transmission Holdings, Inc. (ALSN) Seasonal Chart Arconic Inc. (ARNC) Seasonal Chart Cooper Tire & Rubber Company (CTB) Seasonal Chart CRH Medical Corporation (CRHM) Seasonal Chart Diamond Offshore Drilling, Inc. (DO) Seasonal Chart IDEX Corporation (IEX) Seasonal Chart J & J Snack Foods Corp. (JJSF) Seasonal Chart Loews Corporation (L) Seasonal Chart McDonald's Corporation (MCD) Seasonal Chart Molina Healthcare Inc (MOH) Seasonal Chart NutriSystem Inc (NTRI) Seasonal Chart Rent-A-Center Inc. (RCII) Seasonal Chart Tenet Healthcare Corporation (THC) Seasonal Chart Transocean Ltd. (RIG) Seasonal Chart U S Concrete, Inc. (USCR) Seasonal Chart Vornado Realty Trust (VNO) Seasonal Chart Whiting Petroleum Corporation (WLL) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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