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Stock Market Outlook for November 4, 2019


Put-call ratio down to the second lowest level of the year, hinting of investor complacency.

 

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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NVR, Inc. (NYSE:NVR) Seasonal Chart

NVR, Inc. (NYSE:NVR) Seasonal Chart

Hooker Furniture Corp. (NASD:HOFT) Seasonal Chart

Hooker Furniture Corp. (NASD:HOFT) Seasonal Chart

Marinemax, Inc. (NYSE:HZO) Seasonal Chart

Marinemax, Inc. (NYSE:HZO) Seasonal Chart

Anthem, Inc. (NYSE:ANTM) Seasonal Chart

Anthem, Inc. (NYSE:ANTM) Seasonal Chart

Medtronic, Inc. (NYSE:MDT) Seasonal Chart

Medtronic, Inc. (NYSE:MDT) Seasonal Chart

Unifirst Corp. (NYSE:UNF) Seasonal Chart

Unifirst Corp. (NYSE:UNF) Seasonal Chart

H&E Equipment Services Inc. (NASD:HEES) Seasonal Chart

H&E Equipment Services Inc. (NASD:HEES) Seasonal Chart

Cambridge Bancorp (NASD:CATC) Seasonal Chart

Cambridge Bancorp (NASD:CATC) Seasonal Chart

 

 

The Markets

Stocks rallied following the release of employment data for the month of October.  The Bureau of Labor Statistics indicates that 128,000 payrolls were added last month, which is a beat versus the consensus estimate that called for a rise of 90,000. The unemployment rate ticked higher to 3.6% from 3.5% and average hourly earnings were higher by 0.2%, inline with the consensus analyst estimate. Stripping out the seasonal adjustments, payrolls actually increased by 947,000, or 0.6%, in September, which is inline with the increase that is average for this time of year. The year-to-date change versus the seasonal norm now sits 0.4% above average with two months left in the year to report.  We sent out further insight to subscribers intraday.  Subscribe now and we’ll send you our report showing what is actually occurring in the labour market, rather than what the adjustments are hypothesizing.

http://charts.equityclock.com/seasonal_charts/economic_data/PAYNSA_seasonal_chart.PNG

The S&P 500 Index punched out a gain of almost one percent, closing at a new record high.  The benchmark opened a gap between 3040 and 3050, jumping up and testing the upper limit to its short-term rising range.  Short-term momentum indicators are back to hovering around overbought levels, suggesting a fill of the gap opened during Friday’s session is a reasonable probability in the near-term.

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For the week, the large-cap benchmark was higher by 1.47%, moving into the upper quadrant of the weekly rising trading range that has been intact for much of the year.  The 20-week moving average, approximately equivalent to the 100-day moving average, continues to point higher, providing a bullish bias for the longer-term.  Has this bullish shift in stocks caught you off guard?  For many months we have provided our reasoning in our monthly outlooks and intraday reports as to why the three prongs to our approach suggest a bullish bias in stocks, effectively pushing back on the consensus that had developed through the summer that a recession was on the horizon and that stocks were vulnerable.  Many of the areas that we’ve highlighted in our reports are up significantly since presented.  Don’t get caught up in the consensus and let us inform you of what is actually occurring in the economy and the resulting impact on stocks.  Subscribe now.

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Friday’s move was notably risk-on with cyclicals topping the leaderboard and the defensives closing the session flat to negative.  One of the areas of risk that rallied on the day were the small-caps, which, according to the Russell 2000 Index ETF (IWM), added 1.70%.  The ETF is back to the upper limit of its summer trading range that spans between $144 and $158.  The next move will be critical.  A break out of the range would suggest a continuation of recent gains in the magnitude of the previous span.  Conversely, a rejection would lead to a retest of levels of support below.  The Small-Cap benchmark has been the proxy of risk sentiment of investors, showing relative performance that has been in decline since the fist quarter of the year as recession concerns fuelled performance in defensive bets.  Relative performance has recently found a low, setting the stage for a period of outperformance in the beleaguered market segment and a general gravitation towards risk in the broader market.

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Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.74.  This is the second lowest level of the year, trailing just marginally behind the 0.73 print revealed on July 24th.  The bullish read hints of complacency, which could make markets vulnerable to a shock event.

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Seasonal charts of companies reporting earnings today:

Itau Unibanco Banco Holding SA Seasonal Chart Marriott International Seasonal Chart Sysco Corporation Seasonal Chart Prudential Financial, Inc. Seasonal Chart Occidental Petroleum Corporation Seasonal Chart Consolidated Edison Inc Seasonal Chart Nutrien Ltd. Seasonal Chart FirstEnergy Corp. Seasonal Chart Realty Income Corporation Seasonal Chart Sprint Corporation Seasonal Chart Hartford Financial Services Group, Inc. (The) Seasonal Chart Pioneer Natural Resources Company Seasonal Chart Ringcentral, Inc. Seasonal Chart International Flavors & Fragrances, Inc. Seasonal Chart STERIS plc Seasonal Chart Jack Henry & Associates, Inc. Seasonal Chart Aqua America, Inc. Seasonal Chart Western Midstream Partners, LP Seasonal Chart Under Armour, Inc. Seasonal Chart Neurocrine Biosciences, Inc. Seasonal Chart Fair Isaac Corporation Seasonal Chart Bausch Health Companies Inc. Seasonal Chart Mosaic Company (The) Seasonal Chart BWX Technologies, Inc. Seasonal Chart Aaron's, Inc. Seasonal Chart Howard Hughes Corporation (The) Seasonal Chart Black Hills Corporation Seasonal Chart Kemper Corporation Seasonal Chart Marriott Vacations Worldwide Corporation Seasonal Chart Healthcare Realty Trust Incorporated Seasonal Chart Insperity, Inc. Seasonal Chart Cimarex Energy Co Seasonal Chart OUTFRONT Media Inc. Seasonal Chart Chegg, Inc. Seasonal Chart Tandem Diabetes Care, Inc. Seasonal Chart American States Water Company Seasonal Chart Taro Pharmaceutical Industries Ltd. Seasonal Chart Regal Beloit Corporation Seasonal Chart Sunstone Hotel Investors, Inc. Seasonal Chart Delek US Holdings, Inc. Seasonal Chart QTS Realty Trust, Inc. Seasonal Chart Tenet Healthcare Corporation Seasonal Chart Kennametal Inc. Seasonal Chart Cabot Corporation Seasonal Chart Kosmos Energy Ltd. Seasonal Chart Myriad Genetics, Inc. Seasonal Chart Diodes Incorporated Seasonal Chart MakeMyTrip Limited Seasonal Chart Otter Tail Corporation Seasonal Chart Fabrinet Seasonal Chart Freshpet, Inc. Seasonal Chart Allscripts Healthcare Solutions, Inc. Seasonal Chart Trinseo S.A. Seasonal Chart Kaman Corporation Seasonal Chart Groupon, Inc. Seasonal Chart Rambus, Inc. Seasonal Chart Masonite International Corporation Seasonal Chart TriMas Corporation Seasonal Chart Brookdale Senior Living Inc. Seasonal Chart Coeur Mining, Inc. Seasonal Chart Sykes Enterprises, Incorporated Seasonal Chart Schweitzer-Mauduit International, Inc. Seasonal Chart TEGNA Inc. Seasonal Chart Par Pacific Holdings, Inc. Seasonal Chart Addus HomeCare Corporation Seasonal Chart Douglas Dynamics, Inc. Seasonal Chart Sapiens International Corporation N.V. Seasonal Chart Primoris Services Corporation Seasonal Chart Phibro Animal Health Corporation Seasonal Chart Luminex Corporation Seasonal Chart Solar Capital Ltd. Seasonal Chart Callon Petroleum Company Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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