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Stock Market Outlook for December 17, 2019


Percent of stocks trading above 200-day moving averages finally breaking out as the energy sector, the last sector that was below the long-term hurdle, starts to participate.

 

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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Neptune Technologies & BioResources Inc. (NASD:NEPT) Seasonal Chart

Neptune Technologies & BioResources Inc. (NASD:NEPT) Seasonal Chart

Silver Bull Resources, Inc. (TSE:SVB.TO) Seasonal Chart

Silver Bull Resources, Inc. (TSE:SVB.TO) Seasonal Chart

Raytheon (NYSE:RTN) Seasonal Chart

Raytheon (NYSE:RTN) Seasonal Chart

Papa Johns Intl, Inc. (NASD:PZZA) Seasonal Chart

Papa Johns Intl, Inc. (NASD:PZZA) Seasonal Chart

Henry Schein, Inc. (NASD:HSIC) Seasonal Chart

Henry Schein, Inc. (NASD:HSIC) Seasonal Chart

Petroleo Brasileiro SA (NYSE:PBR/A) Seasonal Chart

Petroleo Brasileiro SA (NYSE:PBR/A) Seasonal Chart

Arbor Realty Trust Inc. (NYSE:ABR) Seasonal Chart

Arbor Realty Trust Inc. (NYSE:ABR) Seasonal Chart

Lundin Mining Corp. (TSE:LUN.TO) Seasonal Chart

Lundin Mining Corp. (TSE:LUN.TO) Seasonal Chart

McEwen Mining Inc. (TSE:MUX.TO) Seasonal Chart

McEwen Mining Inc. (TSE:MUX.TO) Seasonal Chart

Winpak Ltd. (TSE:WPK.TO) Seasonal Chart

Winpak Ltd. (TSE:WPK.TO) Seasonal Chart

Air Transport Services Group Inc. (NASD:ATSG) Seasonal Chart

Air Transport Services Group Inc. (NASD:ATSG) Seasonal Chart

Killam Apartment REIT (TSE:KMP/UN.TO) Seasonal Chart

Killam Apartment REIT (TSE:KMP/UN.TO) Seasonal Chart

Ambev SA (NYSE:ABEV) Seasonal Chart

Ambev SA (NYSE:ABEV) Seasonal Chart

 

 

The Markets

Stocks added to last week’s gains as investors bumped up equity exposure given the removal of a number of uncertainties that had been overhanging the market for a number of months.  The S&P 500 Index ended the session with a gain of just over seven-tenths of one percent, continuing to advance beyond major moving averages.  Momentum indicators are moving back into overbought territory, which has been a sign of strength in this market advance over the past month.  The large-cap benchmark is making an attempt to break above the upper limit of its intermediate rising trend channel, hinting that the alleviation of the recent uncertainties pertaining to tariffs, Brexit, and US monetary policy is enough to set the market on a new trajectory.

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Topping the leaderboard on Monday were energy stocks as investors search for value in this market that is consistently pushing towards new all-time highs.  The sector ETF (XLE) added 1.34%, closing above its 200-day moving average for the first time since September.  A month ago, we laid out for subscribers three criteria of what would be required in order to become bullish in the sector.  We sent out an update to subscribers during Monday’s session.  Whether bullish or bearish of the sector, you don’t want to miss this timely analysis that could have significant implications through the end of the year.  Subscribe now and we’ll send it to you.

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Energy was the last sector holdout that had been struggling below its 200-day moving average, but, with fundamental uncertainties alleviated, there is now little reason for investors to maintain a bearish bias.  The percent of stocks trading above 200-day moving averages on the S&P 500 Index is similarly breaking out.  On Monday, the breadth indicator pushed above 77%, a level that had acted as a peak over the past six months.  Previous advances to all-time highs had peaked when the breadth indicator moved above 80, therefore it was presenting concern, albeit slight, that the same support was not apparent this time around.  Typically, it just takes at least two-thirds of stocks in the large-cap benchmark to create a sustainable advance, a scenario that was achieved (with some variability) in the month of March.

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Sentiment on Monday, as gauged by the put-call ratio, ended bullish at 0.87.

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Sectors and Industries entering their period of seasonal strength:

Biotech Industry Seasonal Chart
S5BIOTX Index Relative to the S&P 500S5BIOTX Index Relative to the Sector

S5BIOTX Index Monthly Averages

Platinum Futures (PL) Seasonal Chart

 

 

Seasonal charts of companies reporting earnings today:

FedEx Corporation Seasonal Chart Cintas Corporation Seasonal Chart Jabil Inc. Seasonal Chart Navistar International Corporation Seasonal Chart Worthington Industries, Inc. Seasonal Chart Steelcase Inc. Seasonal Chart

 

S&P 500 Index

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TSE Composite

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