Stock Market Outlook for October 25, 2019
Put-call ratio down to the lowest level of the past few months, raising concerns of near-term complacency.
*** 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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Avid Technology, Inc. (NASD:AVID) Seasonal Chart
Bankunited Inc. (NYSE:BKU) Seasonal Chart
BioMarin Pharmaceutical, Inc. (NASD:BMRN) Seasonal Chart
DSP Group, Inc. (NASD:DSPG) Seasonal Chart
Legg Mason, Inc. (NYSE:LM) Seasonal Chart
Icahn Enterprises L.P. (NASD:IEP) Seasonal Chart
IPG Photonics Corp. (NASD:IPGP) Seasonal Chart
NCR Corp. (NYSE:NCR) Seasonal Chart
Regal-Beloit Corp. (NYSE:RBC) Seasonal Chart
Radware Ltd. (NASD:RDWR) Seasonal Chart
F5 Networks, Inc. (NASD:FFIV) Seasonal Chart
Comcast Corp. (NASD:CMCSA) Seasonal Chart
Old Dominion Freight Line, Inc. (NASD:ODFL) Seasonal Chart
Mediagrif Interactive Technologies Inc. (TSE:MDF.TO) Seasonal Chart
Cymbria Corp. (TSE:CYB.TO) Seasonal Chart
Marvell Technology Group, Ltd. (NASD:MRVL) Seasonal Chart
Liberty Global Inc. (NASD:LBTYA) Seasonal Chart
Align Technology, Inc. (NASD:ALGN) Seasonal Chart
The Markets
Stocks posted marginal gains on Thursday as the earnings season rolls on. The S&P 500 Index added just less than two-tenths of one percent, supported by technology stocks following a better than expected report from Microsoft. The large-cap benchmark continues to show hesitation around the all-time highs as investors wait for that catalyst to fuel a breakout. Bond prices closed relatively flat and the price of gold caught a bid, despite a stronger US Dollar, suggesting some investor unease around the all-time peak for stocks. The ongoing uncertainty surrounding Brexit is likely a concern.
On the economic front, a report on durable goods orders was released before Thursday’s opening bell. The headline print indicated that activity in the US fell by 1.1% last month, missing the consensus analyst estimate that called for a decline of 0.7%. Core capital goods were lower by 0.5%, which was also a miss versus the 0.2% decline that was forecast. Stripping out the seasonal adjustments, the value of manufacturers’ new orders for durable goods industries actually increased by 0.6% in September, which is well short of the 6.0% increase that is average for the end of the third quarter. The result places the year-to-date change 2.9% below the seasonal average trend with just three months left in the year to report. The trend has been gyrating between above and below average levels all year as varying factors take a toll. We sent out further insight to subscribers. If you haven’t signed up yet, you can do so by selecting the monthly or yearly option via the following link: https://charts.equityclock.com/subscribe
Sentiment on Thursday, as gauged by the put-call ratio, ended bullish at 0.78. The ratio matches the lowest level from the past few months, raising concerns of near-term complacency. Following a similar read on September 11th, equity markets charted a short-term peak soon thereafter, eventually rolling over into the start of October. Reason for near-term caution is warranted.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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