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Stock Market Outlook for June 19, 2019


S&P 500 Index breaks out of its short-term narrow range to close above psychological resistance at 2900.

 

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:

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Armstrong World Industries Inc. (NYSE:AWI) Seasonal Chart

Armstrong World Industries Inc. (NYSE:AWI) Seasonal Chart

CNB Financial Corp. (NASD:CCNE) Seasonal Chart

CNB Financial Corp. (NASD:CCNE) Seasonal Chart

Lindsay Corp. (NYSE:LNN) Seasonal Chart

Lindsay Corp. (NYSE:LNN) Seasonal Chart

Novartis A G (NYSE:NVS) Seasonal Chart

Novartis A G (NYSE:NVS) Seasonal Chart

RLI Corp. (NYSE:RLI) Seasonal Chart

RLI Corp. (NYSE:RLI) Seasonal Chart

German American Bancorp (NASD:GABC) Seasonal Chart

German American Bancorp (NASD:GABC) Seasonal Chart

 

 

The Markets

Stocks jumped on Tuesday following headlines that revealed a meeting between China and the US at the upcoming G20 Summit.  The S&P 500 Index added just less than one percent, breaking out form the narrow short-term range highlighted in recent days.  The break of psychological resistance at 2900 opens the door for a test of the all-time high at 2954.  The session was noticeably risk-on as defensive sectors were shed in favour of cyclicals.  Consumer staples, utilities, and real estate sat out of the market rally, closing lower on the day, while technology and industrials realized gains of almost two percent.  Investors have sought the shelter of defensive equity sectors, bonds, and, recently, gold, an unwind of which would present fuel for the next leg higher in broad equity benchmarks.  Reaction to Wednesday’s FOMC meeting could be pivotal.  Taking a quote from the President, “Let’s see what he [Jerome Powell] does.”

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On the economic front, a report on housing starts was released before the opening bell.  The headline print for the May report indicates that activity fell by 0.9% last month, following upward revisions to the month prior, to a seasonally adjusted annual rate of 1.269 million. The consensus estimate was for a rate of 1.239 million. Stripping out the seasonal adjustments, housing starts actually increased by 0.7% in May, which is weaker than the 4.5% increase that is average for this time of year. The year-to-date change is now higher by an impressive 56.2%, which is 16.8% above average through this point in the year. This is the best pace since 2012.  We sent out more detail and analysis to subscribers intraday.  Subscribe now and join our list to receive our reports directly in your inbox.

Housing Starts Seasonal Chart

North of the border, Canadian Manufacturing Sales for the month of April were released.  Statscan indicates that Manufacturing Sales in Canada declined by 0.6% in April, which is a significant miss versus expectations of a gain of 0.5%. Stripping out the seasonal adjustments, Sales of Goods Manufactured actually fell by 3.7% in the spring month, which is better than the 5.2% decline that is average for this time of year. The year-to-date change is now trending 2.3% above average through the first four months of the year, which is the best pace since 2013.  Subscribe now and we’ll send you our full analysis that includes an area of the market poised to perform well given the above average activity in both Canada and the US.

Sales of goods manufactured (shipments) Seasonal Chart

Sentiment on Tuesday, as gauged by the put-call ratio, ended slightly bullish at 0.91

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Seasonal charts of companies reporting earnings today:

Alithya Group inc. (ALYA) Seasonal Chart American Outdoor Brands Corporation (AOBC) Seasonal Chart American Software, Inc. (AMSWA) Seasonal Chart Oracle Corporation (ORCL) Seasonal Chart Steelcase Inc. (SCS) Seasonal Chart Winnebago Industries, Inc. (WGO) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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