Equity Clock

Stock Market Outlook for October 29, 2020

Oil inventories are on the rise, elevating the days of supply of the commodity, as per seasonal norms.

 

 

 

*** 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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Goodyear Tire & Rubber Co. (NASD:GT) Seasonal Chart

Johnson Controls Intl plc (NYSE:JCI) Seasonal Chart

Vulcan Materials Co. (NYSE:VMC) Seasonal Chart

La Z Boy, Inc. (NYSE:LZB) Seasonal Chart

Cabot Corp. (NYSE:CBT) Seasonal Chart

Copart, Inc. (NASD:CPRT) Seasonal Chart

Asbury Automotive Group Inc. (NYSE:ABG) Seasonal Chart

Avid Technology, Inc. (NASD:AVID) Seasonal Chart

iShares U.S. Industrials ETF (NYSE:IYJ) Seasonal Chart

 

Upcoming Event:

On November 6th at 2:00pm ET, we will be presenting at the Money Show’s Virtual Expo on the topic of “Using Seasonality to Invest During a Pandemic.”  Registration is free via the following link:

 

 

The Markets

Stocks plunged on Wednesday as investors reacted to the rising coronavirus case counts around the globe and expected economic restrictions that will result.  The S&P 500 Index closed lower by 3.53%, realizing the weakest single-session performance since June 11th.  The decline broke a level of significant support at the 100-day moving average, a hurdle that supported the benchmark back in the middle of September.  Major moving averages at the 20 and 50-day are now firmly in a position of resistance.  The next major variable hurdle below is the 200-day moving average at 3129, or another 4.3% below present levels.  Momentum indicators for the large-cap benchmark continue to point lower following last week’s sell signal with respect to MACD and have yet to show signs of bottoming.  Horizontal support at 3200 is going to be a major level to watch as a significant break of this hurdle would give merit to the prospect of a double top below previous resistance around 3588.  For now, all that can be implied is a range-bound trade between support at 3200 and resistance at 3588.  Long-term investors can place their bets based on the direction of the break, whether it be higher or lower.

Soon to be released…

We are busy drafting up our monthly report for November, which highlights everything you need to know for the month(s) ahead.  This report will be sent out to subscribers in the next couple of days.

Signup now to be included on our distribution list.

On schedule for the Wednesday session, the Energy Information Administration (EIA) released its report of petroleum inventories for the week just past.  The EIA indicated that oil inventories increased by 4.3 million barrels last week, which was much larger than the build expected by analysts of 1.23 million barrels.  Gasoline stockpiles, meanwhile, declined by 892,000 barrels, while distillates were down by 4.5 million barrels.  The result saw the days of supply of oil tick higher by half of a day to 36.6, while gasoline days of supply ticked lower by one-tenth to 26.4.  The average days of supply for each at this point in October is 22.7 and 23.7, respectively.  We sent out further insight to subscribers intraday.  Subscribe now to be included on our distribution list.

Sentiment on Wednesday, as gauged by the put-call ratio, ended bearish at 1.11.  In our ongoing monitoring of the dark index in order to gauge institutional buying demand, the level did decline in the Wednesday session from 41% to 40.3%.  Levels above 45% indicate buying demand.  The index has been hovering around this zone for the past couple of weeks as investors show their unwillingness to being too bullish or bearish ahead of the presidential election.

 

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

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