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Stock Market Outlook for January 4, 2019


Employment typically unchanged in the month of December.

 

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:

Providence Service Corp. (NASD:PRSC) Seasonal Chart

Providence Service Corp. (NASD:PRSC) Seasonal Chart

Eastern Co. (NASD:EML) Seasonal Chart

Eastern Co. (NASD:EML) Seasonal Chart

RioCan Real Estate Investment Trust (TSE:REI.UN) Seasonal Chart

RioCan Real Estate Investment Trust (TSE:REI.UN) Seasonal Chart

The Hershey Company  (NYSE:HSY) Seasonal Chart

The Hershey Company (NYSE:HSY) Seasonal Chart

Gencor Industries Inc. (NASD:GENC) Seasonal Chart

Gencor Industries Inc. (NASD:GENC) Seasonal Chart

Monro Muffler Brake, Inc.  (NASDAQ:MNRO) Seasonal Chart

Monro Muffler Brake, Inc. (NASDAQ:MNRO) Seasonal Chart

Halliburton Company  (NYSE:HAL) Seasonal Chart

Halliburton Company (NYSE:HAL) Seasonal Chart

 

 

The Markets

Stocks dipped on Thursday as a rare earnings warning from Apple reignited fears of a global economic slowdown.  The S&P 500 Index shed 2.48%, dragged lower by the technology sector, which saw a loss of over 5% on the day.  The S&P 500 Technology Sector Index remains bound below resistance at 20, 50, and 200-day moving averages with momentum indicators firmly embedded in bearish territory.  The silver lining to the sector is that the decline since the October peak has charted a parabolic trend lower, an unsustainable slope that suggests a reversion to the mean is increasingly probable.  Seasonally, technology is one of the few sectors that has not averaged a loss in the first month of the year, a tendency that, at least right now, looks to be in doubt given the ongoing negative sentiment that is prevailing in the market.

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Technology Sector Seasonal Chart

TECHNOLOGY Monthly Averages

On Friday, investors will be looking towards the next catalyst for stocks by way of the monthly non-farm payroll report.  Analysts are expecting that 180,000 new payrolls were added last month, an improvement from the 155,000 reported previous.  Seasonally, employment in the month of December has historically been unchanged, on average, before incorporating in the seasonal adjustments.  Employment in the US continues to show growth that is firmly above average, on track to post its best calendar year since 2015.  We’ll be sending out a breakdown of the report, from a seasonal perspective, to subscribers of our service on Friday.  Want to be included in this distribution?  Simply subscribe to either the monthly or yearly option via the following link: https://charts.equityclock.com/subscribe

Total Nonfarm Seasonal Chart

Monthly Total Nonfarm Data

Sentiment on Thursday, as gauged by the put-call ratio, ended overly bearish at 1.31.  The result is just the latest in a number of overly bearish readings that this indicator has produced over the past few months, the highest being the 1.82 level realized on December 20th.  The market is overwhelmingly leaning towards the bear camp, making it prone to a mean reversion move as hedges and negative bets are unwound.  Some kind of catalyst is likely required to kick investors out of their bearish bets.

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Seasonal charts of companies reporting earnings today:

AngioDynamics, Inc. (ANGO) Seasonal Chart Cal-Maine Foods, Inc. (CALM) Seasonal Chart RPM International Inc. (RPM) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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