Stock Market Outlook for March 27, 2019
S&P 500 gaps back above 2800 as investors chase beaten down names.
*** 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:
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Mack-Cali Realty Corp. (NYSE:CLI) Seasonal Chart
Apogee Enterprises, Inc. (NASD:APOG) Seasonal Chart
Donnelley R R & Sons Co. (NYSE:RRD) Seasonal Chart
Vornado Realty Trust (NYSE:VNO) Seasonal Chart
Dean Foods, Inc. (NYSE:DF) Seasonal Chart
Loews Corp. (NYSE:L) Seasonal Chart
American Intl Group, Inc. (NYSE:AIG) Seasonal Chart
Dollar General Corp. (NYSE:DG) Seasonal Chart
Enbridge, Inc. (NYSE:ENB) Seasonal Chart
The Markets
Stocks snapped back on Tuesday as areas that had been beaten down in recent days found some buying demand. The S&P 500 Index closed higher by nearly three-quarters of one percent, led by financials and energy. The large-cap benchmark gapped higher from around its 20-day moving average, retaking levels back above resistance at 2815. The open gap shown on the hourly chart is now in a position to act as support. The next few days will likely see further rotation amongst market sectors as investors look to close the book on the first quarter.
On the economic front, a couple of reports on housing point to a cooler market than what was observed last year. The headline print of February’s report on US Housing Starts indicated a decline of 8.7% to a seasonally adjusted annualized rate of 1.162 million. Analysts were expecting a decline of 5.7% to a rate of 1.201 million. Stripping out the seasonal adjustments, housing starts in the US actually declined by 4.5%, which is a divergence compared to the 5.0% gain that is average for this time of year. The year-to-date change continues to hold above the seasonal average trend, now by just 4.8%. By comparison, the pace seen through the first two months of last year was 8.0% above the seasonal average trend. Subscribers to our service were provided with further insight on this gauge of the housing market. An approaching seasonal trade in the home building stocks was also highlighted. Subscribe now to be included on future distributions.
Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.88.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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