Stock Market Outlook for June 26, 2020
Durable Goods Orders in the US rebounded last month, but they still have a ways to go to return to levels that would be considered normal for this time of year.
*** 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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Tanger Fctry Outlet Cntrs (NYSE:SKT) Seasonal Chart
Tempur-Pedic Intl Inc. (NYSE:TPX) Seasonal Chart
QUALCOMM Inc. (NASD:QCOM) Seasonal Chart
AGF Management Ltd. (TSE:AGF/B.TO) Seasonal Chart
BCE, Inc. (NYSE:BCE) Seasonal Chart
Pacer Trendpilot 100 ETF (AMEX:PTNQ) Seasonal Chart
The Markets
Stocks closed firmly higher on Thursday following a late day surge in financial stocks as investors reacted to news that regulations would be rolled back for the big banks. The S&P 500 Index closed higher by 1.10%, clawing back some of the loss realized in the previous session. The benchmark tested support at its 200-day moving average at the lows of the session, enticing investors off the sidelines to buy around the significant hurdle. Recently broken support, now resistance, at the 20-day moving average is directly overhead at 3109. Major moving averages continue to maintain a positive slope, providing a backstop to the recent pullback. Momentum indicators remain on sell signals as buying demand has faded in recent weeks.
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On the economic front, the latest tally of durable goods orders was released. The headline print of May’s report indicated that new orders in the US increased by 15.8% last month, which was stronger than the consensus analyst estimate that called for an increase of 10.0%. Core capital goods orders, meanwhile, showed an increase of 2.3%, which was also stronger than the consensus analyst estimate that called for an increase of a mere 0.6%. Stripping out the seasonal adjustments, the value of manufacturers’ new orders for durable goods industries actually increased by 12.8% in May, which is much stronger than the 2.9% increase that is average for this spring month. The year-to-date change is now down by 23.2% through the first five months of the year, which is a significant gap compared to the 3.8% decline that is average. We sent out further insight to subscribers intraday, including the areas of the economy that are performing well compared to seasonal norms in this pandemic. Subscribe now.
Sentiment on Thursday, as gauged by the put-call ratio, ended bullish at 0.89.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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