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Stock Market Outlook for July 30, 2018

Financials and Industrials early beneficiaries of this new rotation in stocks.

 

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:

Xcel Energy Inc.  (NYSE:XEL) Seasonal Chart

Xcel Energy Inc. (NYSE:XEL) Seasonal Chart

NetGear, Inc. (NASD:NTGR) Seasonal Chart

NetGear, Inc. (NASD:NTGR) Seasonal Chart

Sierra Metals Inc.. (TSE:SMT) Seasonal Chart

Sierra Metals Inc.. (TSE:SMT) Seasonal Chart

SYSCO Corporation  (NYSE:SYY) Seasonal Chart

SYSCO Corporation (NYSE:SYY) Seasonal Chart

State Bank Financial Corp. (NASD:STBZ) Seasonal Chart

State Bank Financial Corp. (NASD:STBZ) Seasonal Chart

McDonald's Corporation  (NYSE:MCD) Seasonal Chart

McDonald’s Corporation (NYSE:MCD) Seasonal Chart

Granite Construction Inc. (NYSE:GVA) Seasonal Chart

Granite Construction Inc. (NYSE:GVA) Seasonal Chart

Symantec Corporation  (NASDAQ:SYMC) Seasonal Chart

Symantec Corporation (NASDAQ:SYMC) Seasonal Chart

Great Plains Energy Incorporated  (NYSE:GXP) Seasonal Chart

Great Plains Energy Incorporated (NYSE:GXP) Seasonal Chart

 

 

The Markets

Stocks weakened on Friday in a move that can only be chalked up to rotation.  The S&P 500 Index shed two-thirds of one percent, retracing all of Wednesday’s gain attributed to trade agreement between the United States and European Union.  Negative reaction to earnings of Facebook and Intel had investors pushing the sell button on technology holdings, trimming exposure ahead of the close of the month.  The S&P 500 Index continues to show reaction to a convergence of resistance around 2850 and the threat of a continued rotation away from the technology sector risks that these hurdles remain intact into the near future.  In just two sessions, the technology sector index has cut its gain for the month in half, falling back to the comfort of support around 20 and 50-day moving averages.  While the benchmark charted an all-time high in the latest week, a negative divergence with respect to MACD and performance relative to the market that has been flat over the past couple of months suggests that buying demand is fading as investors look to rotate holdings into areas that have been beaten down in the front half of the year. Industrials and financials are showing signs of being the early beneficiaries of this rotation.  Seasonally, the next period of strength for the sector comes into play in the month of October.

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Technology Sector Seasonal Chart

TECHNOLOGY Relative to the S&P 500
TECHNOLOGY Relative to the S&P 500

TECHNOLOGY Monthly Averages

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Sentiment on Friday, as gauged by the put-call ratio, ended bearish at 1.05.

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Seasonal charts of companies reporting earnings today:

AK Steel Holding Corporation (AKS) Seasonal Chart Alexandria Real Estate Equities, Inc. (ARE) Seasonal Chart Allison Transmission Holdings, Inc. (ALSN) Seasonal Chart athenahealth, Inc. (ATHN) Seasonal Chart AvalonBay Communities, Inc. (AVB) Seasonal Chart Booz Allen Hamilton Holding Corporation (BAH) Seasonal Chart Caterpillar, Inc. (CAT) Seasonal Chart Denny's Corporation (DENN) Seasonal Chart Diamond Offshore Drilling, Inc. (DO) Seasonal Chart Everest Re Group, Ltd. (RE) Seasonal Chart Illumina, Inc. (ILMN) Seasonal Chart J & J Snack Foods Corp. (JJSF) Seasonal Chart KLA-Tencor Corporation (KLAC) Seasonal Chart Loews Corporation (L) Seasonal Chart Logitech International S.A. (LOGI) Seasonal Chart Oil States International, Inc. (OIS) Seasonal Chart Range Resources Corporation (RRC) Seasonal Chart Rent-A-Center Inc. (RCII) Seasonal Chart Seagate Technology PLC (STX) Seasonal Chart Simon Property Group, Inc. (SPG) Seasonal Chart Transocean Ltd. (RIG) Seasonal Chart Vermilion Energy Inc. (VET) Seasonal Chart Vornado Realty Trust (VNO) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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