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Stock Market Outlook for August 14, 2019


S&P 500 Index jumps back to its 50-day moving average following news of the delay of tariffs on certain items.

 

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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NICE Ltd. (NASD:NICE) Seasonal Chart

NICE Ltd. (NASD:NICE) Seasonal Chart

Accenture Ltd. (NYSE:ACN) Seasonal Chart

Accenture Ltd. (NYSE:ACN) Seasonal Chart

Nokia Corp. (NYSE:NOK) Seasonal Chart

Nokia Corp. (NYSE:NOK) Seasonal Chart

ManTech Intl Corp. (NASD:MANT) Seasonal Chart

ManTech Intl Corp. (NASD:MANT) Seasonal Chart

Highpower International, Inc. (NASD:HPJ) Seasonal Chart

Highpower International, Inc. (NASD:HPJ) Seasonal Chart

 

 

The Markets

Stocks rebounded on Tuesday amidst news that the Trump Administration would delay tariffs on certain items from September 1 to December 15.  The S&P 500 Index gained 1.51%, led by technology and consumer discretionary, as investors embraced the apparent easing of trade tensions.  The large-cap benchmark reacted to resistance at its 50-day moving average at the highs of the session, suggesting the sensitivity of investors to this important intermediate hurdle. 

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On the hourly chart, short-term resistance around 2940 presents the neckline to a head-and-shoulders bottoming pattern, a breakout from which could see a move back to the previous high.  While the bullish setup does look intriguing and warrants further monitoring, the prospect of the continuation of a standard ABC correction remains probable.  Investors need to regain confidence in equities following the worst session of the year just over one week ago, which is likely to keep markets capped until a new equilibrium between buyers and sellers is derived.  Seasonally, the third quarter typically results in erratic trading for stocks as fundamental catalysts over this timeframe are typically fewer.

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On the economic front, July’s report on the US Consumer Price Index (CPI) was released before Tuesday’s opening bell.  The report indicated that CPI increased by 0.3% in July, slightly stronger than the consensus estimate that called for an increase of 0.2%. The year-over-year change ticked back higher from from 1.6% to 1.8%, however, it is the core inflation gauge that captures attention. The 2.2% year-over-year increase inches just beyond the Fed’s 2% threshold, arguably the result of tariffs that the Trump administration remains adamant has not influenced prices to any degree. Stripping out the seasonal adjustments, the Consumer Price Index for All Urban Consumers increased by 0.2% in July, which is stronger than the 0.1% increase that is average for this period. The year-to-date change is now higher by 2.1%, which is a tenth of a percent below the seasonal average trend.  Further analysis was sent out to subscribers intraday, including the reason why it was very coincidental that the Trump Administration backed off their pledge to implement some tariffs on September 1, the same day this report on consumer prices was released.  Subscribe now.

Consumer Price Index for All Urban Consumers: All Items Seasonal Chart

Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.93.

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Seasonal charts of companies reporting earnings today:

Agilent Technologies, Inc. (A) Seasonal Chart Alithya Group inc. (ALYA) Seasonal Chart Altimmune, Inc. (ALT) Seasonal Chart Applied Industrial Technologies, Inc. (AIT) Seasonal Chart   CACI International, Inc. (CACI) Seasonal Chart CAE Inc (CAE) Seasonal Chart Canopy Growth Corporation (CGC) Seasonal Chart Cisco Systems, Inc. (CSCO) Seasonal Chart Embraer S.A. (ERJ) Seasonal Chart Hollysys Automation Technologies, Ltd. (HOLI) Seasonal Chart Ideal Power Inc. (IPWR) Seasonal Chart Inuvo, Inc (INUV) Seasonal Chart Just Energy Group, Inc. (JE) Seasonal Chart Lincoln Educational Services Corporation (LINC) Seasonal Chart Macy's Inc (M) Seasonal Chart Neptune Wellness Solutions Inc. (NEPT) Seasonal Chart NetApp, Inc. (NTAP) Seasonal Chart Onconova Therapeutics, Inc. (ONTX) Seasonal Chart SORL Auto Parts, Inc. (SORL) Seasonal Chart Titan Pharmaceuticals, Inc. (TTNP) Seasonal Chart Vipshop Holdings Limited (VIPS) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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