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Stock Market Outlook for December 24, 2019


Durable Goods Orders were exceptionally weak in November, emphasizing the weakness in the manufacturing side of the economy.

 

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.

Industrial Services of America, Inc. (NASD:IDSA) Seasonal Chart

Industrial Services of America, Inc. (NASD:IDSA) Seasonal Chart

Hawthorn Bancshares, Inc. (NASD:HWBK) Seasonal Chart

Hawthorn Bancshares, Inc. (NASD:HWBK) Seasonal Chart

DTE Energy Co. (NYSE:DTQ) Seasonal Chart

DTE Energy Co. (NYSE:DTQ) Seasonal Chart

Duke Energy Corp. (NYSE:DUKH) Seasonal Chart

Duke Energy Corp. (NYSE:DUKH) Seasonal Chart

PPL Capital Funding, Inc. (NYSE:PPX) Seasonal Chart

PPL Capital Funding, Inc. (NYSE:PPX) Seasonal Chart

American Eagle Outfitters, Inc. (NYSE:AEO) Seasonal Chart

American Eagle Outfitters, Inc. (NYSE:AEO) Seasonal Chart

 

 

The Markets

Equity markets continued their grind higher in typical pre-holiday fashion.  The S&P 500 Index added just less than a tenth of a percent, maintaining a significantly overbought state that has been apparent for the past few sessions.  Seasonally, the days surrounding the Christmas holiday tend to be bullish for stocks, but given the overbought state of equity benchmarks, it would not be surprising to start to see signs of buying exhaustion.  Moving average support presented by the 20 and 50-day are currently 2.1% and 4.0%, respectively, below Monday’s close, highlighting the near-term risks should investors start to book profits.  We are busy preparing our monthly outlook for January, so if you are seeking insight on how to allocate your portfolio for the month(s) ahead, subscribe now and we’ll send it to you when it is complete.

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On the economic front, a report on US Durable Goods Orders was released before Monday’s session.  The headline print indicates that durable goods orders in the US declined by 2.0% last month, a significant miss versus estimates that called for a 1.5% increase. Core capital goods were higher by a mere 0.1%, which was marginally stronger than the unchanged result that was forecast. Stripping out the seasonal adjustments, the value of manufacturers’ new orders for durable goods industries actually declined by 8.7% in November, which is much weaker than the 4.6% decline that is average for this time of year. The result places the year-to-date change 4.0% below the seasonal average trend, which makes this the weakest calendar year performance through November since 2014. The trend has been gyrating between above and below average levels all year as varying factors take a toll.  To read more, subscribe to our service and we’ll send you our report.

Value of Manufacturers' New Orders for Durable Goods Industries Seasonal Chart

Also released on Monday were reports on GDP in Canada and New Home Sales in the US.  We have uploaded the charts for these reports at the following links (subscribers can login to have unrestricted access):

Sentiment on Monday, as gauged by the put-call ratio, ended bullish at 0.80.

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Seasonal charts of companies reporting earnings today:

  • No significant earnings scheduled

 

S&P 500 Index

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TSE Composite

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