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Stock Market Outlook for December 20, 2019


The S&P 500 Technology Sector has achieved its 37th record close of 2019, tying the previous leader, REITs, which last charted a record high at the end of October.

 

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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Dick's Sporting Goods Inc. (NYSE:DKS) Seasonal Chart

Dick’s Sporting Goods Inc. (NYSE:DKS) Seasonal Chart

OceanaGold Corp. (TSE:OGC.TO) Seasonal Chart

OceanaGold Corp. (TSE:OGC.TO) Seasonal Chart

Cosan Ltd. (NYSE:CZZ) Seasonal Chart

Cosan Ltd. (NYSE:CZZ) Seasonal Chart

Dream Office Real Estate Investment Trust (TSE:D/UN.TO) Seasonal Chart

Dream Office Real Estate Investment Trust (TSE:D/UN.TO) Seasonal Chart

Transcontinental Inc. (TSE:TCL/A.TO) Seasonal Chart

Transcontinental Inc. (TSE:TCL/A.TO) Seasonal Chart

TJX Cos., Inc. (NYSE:TJX) Seasonal Chart

TJX Cos., Inc. (NYSE:TJX) Seasonal Chart

Universal Display Corp. (NASD:OLED) Seasonal Chart

Universal Display Corp. (NASD:OLED) Seasonal Chart

National Holdings, Corp. (NASD:NHLD) Seasonal Chart

National Holdings, Corp. (NASD:NHLD) Seasonal Chart

Polymet Mining Corp. (TSE:POM.TO) Seasonal Chart

Polymet Mining Corp. (TSE:POM.TO) Seasonal Chart

New Flyer Industries Inc. (TSE:NFI.TO) Seasonal Chart

New Flyer Industries Inc. (TSE:NFI.TO) Seasonal Chart

Cyanotech Corp. (NASD:CYAN) Seasonal Chart

Cyanotech Corp. (NASD:CYAN) Seasonal Chart

Barclays Plc (NYSE:BCS) Seasonal Chart

Barclays Plc (NYSE:BCS) Seasonal Chart

North American Construction Group Ltd. (NYSE:NOA) Seasonal Chart

North American Construction Group Ltd. (NYSE:NOA) Seasonal Chart

Argonaut Gold Ltd. (TSE:AR.TO) Seasonal Chart

Argonaut Gold Ltd. (TSE:AR.TO) Seasonal Chart

Marriott Intl Inc New (NASD:MAR) Seasonal Chart

Marriott Intl Inc New (NASD:MAR) Seasonal Chart

Sony Corp. (NYSE:SNE) Seasonal Chart

Sony Corp. (NYSE:SNE) Seasonal Chart

Mosaic Co (NYSE:MOS) Seasonal Chart

Mosaic Co (NYSE:MOS) Seasonal Chart

Sienna Senior Living Inc. (TSE:SIA.TO) Seasonal Chart

Sienna Senior Living Inc. (TSE:SIA.TO) Seasonal Chart

Crombie Real Estate Investment Trust (TSE:CRR/UN.TO) Seasonal Chart

Crombie Real Estate Investment Trust (TSE:CRR/UN.TO) Seasonal Chart

 

 

The Markets

Stocks continued their grind higher on Thursday, despite proceedings pertaining to the impeachment of Donald Trump that are making their way through congress.  The S&P 500 Index added just less than half of one percent, moving above short-term resistance at 3200.  Gains stemmed from the communication services, technology, consumer staples, and REIT sectors as investors adopted a barbell allocation amongst defense and growth.  Cyclical sectors of energy, financials, industrials, and materials were laggards by comparison.  For the S&P 500 Technology and Consumer Staple Sector indices, the gains were enough to achieve another set of record closing highs.  Technology has now seen 37 record closes this year, tying the previous sector leader of Real Estate Investment Trusts, which last charted a record close at the end of October.  Utilities and Consumer Staples are following closely behind with 35 and 22 record closes, respectively.  The record closing high count for the cyclical sectors are few by comparison, numbering, for the most part, in the single digit range.  This certainly has been a risk averse market in 2019, despite one of the best returns for the broad market benchmark in years.  Investors have latched on to the defensive trade amidst the expectation of equity market vulnerability given the late stage of this economic cycle.  There is plenty of room for sector rotation through the months ahead, however, should these elevated market leading sectors become victims of this rotation, it could be difficult to see the positive broad market momentum that we have seen through the past twelve months.

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On the economic front, a report on existing home sales was released during Thursday’s session.  The headline print of November’s report indicates that activity declined by 1.7% to a seasonally adjusted annual rate of 5.35 million. Analysts were expecting a rate of 5.45 million. The year-over-year change dropped from +4.2% to +2.7%. Stripping out the seasonal adjustments, existing home sales actually declined by 12.6%, which is weaker than the 9.7% decline that is average for the month. The year-to-date trend has now fallen to 10.0% above average, which is the best pace since 2012.  We sent out further insight to subscribers.  Signup now and we’ll send it to you.

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

Sentiment on Thursday, as gauged by the put-call ratio, ended bullish at 0.78.  Recent volatility in the put-call ratio from overly bullish to bearish bets has caused the 14-day average true range (ATR) to spike to the highest level since the start of the year, typically indicative of investor uncertainty and rapid positioning as investors attempt to allocate for the next major move.  Over the past few years, spikes in the average true range (ATR) have generally been positive for the broad market, such as in March and December of 2018, however, historically, the resulting move has gone in both directions as the uncertainty resolves into a new trend, one way or the other. 

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Seasonal charts of companies reporting earnings today:

Carnival Corporation Seasonal Chart Carnival Corporation Seasonal Chart CarMax Inc Seasonal Chart BlackBerry Limited Seasonal Chart Winnebago Industries, Inc. Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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