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Stock Market Outlook for June 26, 2019


Get ready for the summer rally period for stocks around the globe.

 

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:

Subscribers – Click on the relevant link to view the full profile. Not a subscriber? Signup here.

Booz Allen Hamilton Holding Corp. (NYSE:BAH) Seasonal Chart

Booz Allen Hamilton Holding Corp. (NYSE:BAH) Seasonal Chart

Tempur-Pedic Intl Inc. (NYSE:TPX) Seasonal Chart

Tempur-Pedic Intl Inc. (NYSE:TPX) Seasonal Chart

 

Just released…

The Monthly Outlook for July

 

Highlights in this report include:

  • Equity market tendencies in the month of July
  • A look at the summer rally period
  • Simple strategy of using the VIX for broad market buy and sell decisions
  • The breakout and period of seasonal strength for Gold
  • Seasonal weakness in the US Dollar during the third quarter
  • Why a Fed rate cut may not be as guaranteed as what the market expects
  • The technical status of the S&P 500 Index
  • Notable stocks entering their period of strength in July

 

Subscribe now and we’ll send you a copy of this 63-page report.

 

The Markets

Stocks closed sharply lower on Tuesday following comments from Fed committee member James Bullard, who suggested that a 50 basis point cut in rates at the next meeting would be “overdone.”  The S&P 500 Index shed almost a full percent following the remarks, clawing back the post FOMC gains that were derived based on expectations of a cut as soon as the next meeting.  Resistance around 2950 remains intact.  A number of levels of support can be derived below, including the rising 20 and 50-day moving averages at 2867 and 2879, respectively, as well as horizontal support at 2900.  With Tuesday’s downturn, momentum indicators are rolling over, hinting of imminent sell signals with respect to MACD and Stochastics.

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It has been a while since we’ve done a review of the MCSI World ex US, effectively an aggregate of all of the markets outside of the US.  Much like the US, the benchmark struggled in 2018, concluding the year with a sharp downturn during the fourth quarter.  Indications continue to suggest that the December bottom was a significant low, capping off an over 20% decline that put global equity benchmarks into a bear market.  The benchmark has since rallied back in 2019, moving above its 200-day moving average, a level that was confirmed as support during the May downturn.  Declining trendline resistance from the past year has also been broken and a new rising trend is implied.  Momentum indicators have been trending higher since October of last year, positively diverging from price amidst fourth quarter downturn.  Resistance around 1928 remains a significant hurdle overhead, a breakout from which could see significant upside in the global benchmark.  Seasonally, the benchmark tends to produce gains, on average, between now and the middle of July, a period often referred to as the summer rally.  Beyond this uptick, the benchmark shows neither positive nor negative tendencies through to the next period of strength in the fourth quarter.  In our monthly outlook just sent to subscribers, we highlight markets around the globe that do tend to produce gains, an average, during the volatile third quarter of the year.  Subscribe now to learn more.

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On the economic front, a report on new homes sales was released during Tuesday’s session.  The headline print indicated that sales of new homes in the US declined by 7.8% in May to a seasonally adjusted annual rate of 626,000. Analysts had been expecting a slight increase to a rate of 680,000. Stripping out the seasonal adjustments, sales of new homes actually declined by 10.4% in May, which is much weaker than the 1.3% decline that is average for the spring month. The year-to-date change is now trending 24.2% above the seasonal average trend, which is the best performance since 1998.  We sent out further analysis to subscribers on Tuesday, including insight on what is moving the stocks in the industry.  Don’t be left out on future distributions, subscribe now.

New Home Sales Seasonal Chart

Sentiment on Tuesday, as gauged by the put-call ratio, ended neutral at 0.98.

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Seasonal charts of companies reporting earnings today:

Acasti Pharma, Inc. (ACST) Seasonal Chart Actuant Corporation (ATU) Seasonal Chart BlackBerry Limited (BB) Seasonal Chart General Mills, Inc. (GIS) Seasonal Chart H. B. Fuller Company (FUL) Seasonal Chart Herman Miller, Inc. (MLHR) Seasonal Chart IHS Markit Ltd. (INFO) Seasonal Chart KB Home (KBH) Seasonal Chart Novagold Resources Inc. (NG) Seasonal Chart Paychex, Inc. (PAYX) Seasonal Chart Pier 1 Imports, Inc. (PIR) Seasonal Chart Rite Aid Corporation (RAD) Seasonal Chart Schnitzer Steel Industries, Inc. (SCHN) Seasonal Chart Unifirst Corporation (UNF) Seasonal Chart Worthington Industries, Inc. (WOR) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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