Stock Market Outlook for September 8, 2022
Abrupt downfall of oil creates uncertainty in the energy sector, but this one energy sector industry continues to look good.
*** 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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Great Western Bancorp Inc. (NYSE:GWB) Seasonal Chart
Etho Climate Leadership US ETF (AMEX:ETHO) Seasonal Chart
Oppenheimer Ultra Dividend Revenue ETF (AMEX:RDIV) Seasonal Chart
Invesco Dynamic Large Cap Value ETF (NYSE:PWV) Seasonal Chart
First Trust Dow Jones Select MicroCap Index Fund (NYSE:FDM) Seasonal Chart
The Bank of Nova Scotia (TSE:BNS.TO) Seasonal Chart
Telecom Argentina (NYSE:TEO) Seasonal Chart
Amerco (NASD:UHAL) Seasonal Chart
The Markets
Stocks snapped back on Wednesday as a reprieve in the rise of treasury yields and the US Dollar allowed stocks to flourish. The S&P 500 Index closed higher by 1.83%, reaching back to levels around the still rising 50-day moving average. The intermediate hurdle remains in a position of significant resistance and this test will be telling of whether this recent short-term pullback in the market is complete. Momentum indicators are showing early signs of curling higher following their recent slide with the Relative Strength Index (RSI) rebounding from rising trendline support and the MACD histogram narrowing. While we will have to wait to see how the reaction to the 50-day moving average plays out, if our call that a bottom above the June low as part of our forecasted back half of the year strength is correct, these signals are conducive to seeing this low being realized now. The benchmark has rebounded from horizontal support at 3900, which has proven to be a significant pivot point in the market over the past few months. We are cognizant of the traditional volatility that surrounds the months of September, but we also want to set ourselves up for the traditional end of quarter mean reversion, depending on where stocks land closer to the middle of the month. Bottom line is that Wednesday’s action was highly encouraging, conducive to establishing a short-term low and a higher-intermediate-low above the June bottom, but we would like to see more, particularly above the 50-day moving average, to confirm that the turn has been made in order to ramp up risk exposure in portfolios for our forecasted back half of the year strength.
Today, in our Market Outlook to subscribers, we discuss the following:
- Percent of stocks above their 50-day moving averages
- Breakdown in the price of oil
- Collapsing our exposure to commodities
- Segment of the energy sector showing renewed signs of support
- US Vehicle Sales
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for September 8
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Sentiment on Wednesday, as gauged by the put-call ratio, ended neutral at 0.99.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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