Equity Clock

Stock Market Outlook for March 16, 2021

REITs are gaining a leadership role within the market.  Find out which areas to focus on in today’s report.

 

 

 

*** 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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Tupperware Brands Corp. (NYSE:TUP) Seasonal Chart

TE Connectivity Ltd. (NYSE:TEL) Seasonal Chart

Oceaneering Intl, Inc. (NYSE:OII) Seasonal Chart

Lumber Liquidators Holdings, Inc. (NYSE:LL) Seasonal Chart

Northern Oil and Gas, Inc. (AMEX:NOG) Seasonal Chart

Ecopetrol SA (NYSE:EC) Seasonal Chart

Cohen & Steers Inc. (NYSE:CNS) Seasonal Chart

RBC Bearings Inc. (NASD:ROLL) Seasonal Chart

Tenaris SA (NYSE:TS) Seasonal Chart

Marcus & Millichap, Inc. (NYSE:MMI) Seasonal Chart

Shake Shack Inc. (NYSE:SHAK) Seasonal Chart

iShares U.S. Small Cap Index ETF (CAD-Hedged) (TSE:XSU.TO) Seasonal Chart

Fidelity MSCI Materials Index ETF (AMEX:FMAT) Seasonal Chart

ProShares Ultra Real Estate (NYSE:URE) Seasonal Chart

 

 

The Markets

Stocks gained to start the new week as the rotation in the market continues, today with a shift from some of the value areas that have flourished in recent weeks and back towards growth.  The S&P 500 Index gained two-thirds of one percent, closing at a new record high.  The benchmark is now just shy of the key psychological hurdle at 4,000, a level that market participants will undoubtedly focus on and look to pin the market to into the middle of April.  Horizontal support remains intact at 3700 and variable levels of support at the 20 and 50-day moving averages have been retaken.  This is a difficult market to push down, despite the fact that momentum indicators have pointed to waning buying demand for months.  As highlighted last week, this makes it difficult to ramp up risk in pro-cyclical bets than have become stretched well above levels of support in recent weeks.  While we remain fully invested in stocks, the desire to rotate into higher beta areas of the market ahead of the month of April remains desired, but, unfortunately, the opportunity is evading us.  The back half of March tends to be a notorious mean reversion period, therefore, based on this historical precedent, we cannot rule out that a softer period for stocks (stronger period for bonds) over the short-term.  But, if it doesn’t materialize, we may just have to keep our risk metrics in the portfolio at the current level and look for the spring opportunities to rotate into, some of which have sold off in recent weeks.  So while we desired one thing (a pullback in stocks ahead of quarter-end), we always have to be prepared for an alternative path, while avoiding speculating until the macro fundamental trends provide reason to change our stance.  For now, the macro fundamental trends all remain strong, showing results that are well above seasonal norms, which is conducive to strength in risk assets longer-term.

Want to know which areas of the market to buy or sell?  Our Weekly Chart Books have just been updated, providing a clear Accumulate, Avoid, or Neutral rating for currencies, cryptocurrencies, commodities, broad markets, and subsectors/industries of the market.  Subscribers can login and click on the relevant links to access.

• Currencies
• Cryptocurrencies
• Commodities
• Major Benchmarks
• Sub-sectors / Industries
  

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Today, in our Market Outlook to subscribers, we discuss the following:

• Notable changes in this week’s chart books
• The leadership position that REITs have adopted and which areas to focus on
• Empire State Manufacturing Survey
• Canada Manufacturing Sales and why the headline result may not be as upbeat as what the non-adjusted results suggest

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Sentiment on Monday, as gauged by the put-call ratio, ended bullish at 0.75.

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

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