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Stock Market Outlook for August 30, 2019


Back and forth trading action between 2825 and 2940 continues on the S&P 500 Index.

 

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.

Ryanair Holdings PLC (NASD:RYAAY) Seasonal Chart

Ryanair Holdings PLC (NASD:RYAAY) Seasonal Chart

NetGear, Inc. (NASD:NTGR) Seasonal Chart

NetGear, Inc. (NASD:NTGR) Seasonal Chart

Turkcell Iletisim Hizmetleri AS (NYSE:TKC) Seasonal Chart

Turkcell Iletisim Hizmetleri AS (NYSE:TKC) Seasonal Chart

Pampa Energia SA (NYSE:PAM) Seasonal Chart

Pampa Energia SA (NYSE:PAM) Seasonal Chart

Investor Bancorp Inc. (NASD:ISBC) Seasonal Chart

Investor Bancorp Inc. (NASD:ISBC) Seasonal Chart

 

 

 

The Markets

Stocks jumped on Thursday as trade war fears were alleviated following comments from an official in China encouraging a "calm" resolution to the ongoing dispute.  The S&P 500 Index gapped higher to the tune of 1.27% as investors rotated back in to risk and away from defensive bets.  Financials, energy, technology, communication services, and industrials topped the leaderboard, while consumer staples, utilities and REITs were flat on the day.  The large-cap benchmark is back to the upper limit of the tight short-term trading range between 2825 and 2940; resistance at the 50-day moving average remains a tight lid overhead.  It may take more than an alleviation of the aggressive trade rhetoric to fuel a breakout.  Recent sentiment has been overly negative, which creates a powder keg should a catalyst materialize to force investors back into equity positions.  The defensive/pessimistic posturing removes the impetus to sell, certainly improving the risk-reward of the market compared to where it was around the end of July.  Interested to read our analysis of what the present state of the market says about how you should position your portfolio in the month ahead?  Subscribe now and we’ll send you our just released monthly outlook. 

Highlights in this report include:

  • Equity market tendencies in the month of September
  • Performance of the equity market following an inversion of the yield curve
  • The relationship between equity valuations and interest rates
  • A review of the economic fundamentals
  • How industrial production may be the tell of who will win the White House in 2020
  • The technical status of the S&P 500 Index
  • An outlook for the seasonal trade in Natural Gas
  • Notable stocks entering their period of strength in September

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On the economic front, the advanced report on US International Trade was released before Thursday’s opening bell.  The headline print indicated that the trade deficit narrowed in July from $74.4 Billion to $72.3 Billion, the result of a 0.7% increase in exports and 0.4% decline in imports.  Stripping out the seasonal adjustments, exports actually declined by 4.0%, while imports increased by 5.4%; the average change for each in the month of July is –7.1% and +0.3%, respectively.  The year-to-date change of both are converging, once again, with their seasonal average trends, having offset significant weakness in the month prior.  The trends of import/export activity was one of the areas highlighted to subscribers in a special report detailing the possible shift in trajectory of the economy as of the end of the second quarter.  Gradually, stronger than expected and better than average reports for July are alleviating concerns.  Results for the summer month, notorious for factory shutdowns, can cause highly erratic results, therefore data for August and September are likely to provide the better read of the health of the broader economy, particularly how it relates to manufacturing activity.  Login now to see the remaining seasonal charts of international trade via the following link: https://charts.equityclock.com/u-s-international-trade-data.

US International Trade - Imports Seasonal Chart

US International Trade - Exports Seasonal Chart

Sentiment on Thursday, as gauged by the put-call ratio, ended bearish at 1.01.

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Seasonal charts of companies reporting earnings today:

AAC Holdings, Inc. (AAC) Seasonal Chart Big Lots, Inc. (BIG) Seasonal Chart Campbell Soup Company (CPB) Seasonal Chart Fang Holdings Limited (SFUN) Seasonal Chart JinkoSolar Holding Company Limited (JKS) Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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