April has historically been the strongest month of the year for stocks with the S&P 500 Index gaining an average of 2.3%.

Stock Market Outlook for April 3, 2023

April has historically been the strongest month of the year for stocks with the S&P 500 Index gaining an average of 2.3%.

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:

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Liquidity Services Inc. (NASD:LQDT) Seasonal Chart

Everbridge, Inc. (NASD:EVBG) Seasonal Chart

Newell Brands Inc. (NASD:NWL) Seasonal Chart

MTY Food Group Inc. (TSE:MTY.TO) Seasonal Chart

Baker Hughes Company (NASD:BKR) Seasonal Chart

SPDR S&P Pharmaceuticals ETF (NYSE:XPH) Seasonal Chart

Floor & Decor Holdings, Inc. (NYSE:FND) Seasonal Chart

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The Markets

Stocks rallied to close out the final session of the quarter as investors brush of concerns from the past month pertaining to the banking turmoil and economic degradation and continue to turn to those segments that have been in a position to benefit from the peak in the cost of borrowing. The S&P 500 Index closed with a gain of 1.44%, ending at the high of the month and violating the previously highlighted short-term path of lower-lows and lower-highs stemming from the February peak. The benchmark has moved beyond the confluence of major moving averages in the range of 3900 to 4000 and now finds itself into the horizontal range of resistance between 4100 and 4200 that has capped upside potential for months. Still, despite this barrier overhead, the benchmark remains in this intermediate rising trend of higher-highs and higher-lows stemming from the October lows given that price has managed to hold levels above the December lows. As has been highlighted, this has been sufficient keep the potential of strength that is normal for March and April alive, despite a fundamental backdrop that has been trying to convince us of an alternate direction. Our Accumulate candidates in our weekly chartbooks continue to appropriately target the strength in the market that has been realized through the past month, primarily in the technology sector, but the performance of the past week may require another look at those that are on our list to Avoid given signs of support below some of the segments that have been/are in downtrends are now showing signs of support (eg. Utilities and REITs). Stay tuned to our chart books update on Monday for the highlights.

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

Monthly look at the S&P 500 Index and comparing where we are today to the price action prior to the last sustained economic recession

Using the Inverse VIX ETF as a guide to determining sustained trends in the broader equity market

Average performance of the S&P 500 Index in April

Stocks that have always gained or lost in the fourth month of the year

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Just released…

Our monthly report for April is out and we take a look at all of the dynamics that are playing out fundamentally and technically, as well as the seasonal setups, such that we can navigate through the month ahead and set ourselves up for what could be a tough spring and early summer for the market.

Highlights in this report include:

Equity market tendencies in the month of April

Coincident indications of economic activity warning of the start of a recession

Above average trend of jobless claims

Payrolls have held up well to start the year, but the strength is dominated by those segments that have benefitted from an abnormally mild winter

Performance of safe havens reflecting the concern of investors

As the market becomes defensive, treasury yield spreads are showing signs of bottoming

Defensive tilt

Growth is defensive

Equity market volatility capped given that investors are content to rotate

Durable goods orders struggling in 2023

Manufacturer sentiment outright dismal at this traditionally upbeat time of year

How to defend your portfolio this summer

Spring is the time for real estate

Medical devices

Time to overweight bonds?

April’s currency tailwind

Poor Breadth

Our list of all segments of the market to either Accumulate or Avoid, along with relevant ETFs

Positioning for the months ahead

Sector Reviews and Ratings

Stocks that have Frequently Gained in the Month of April

Notable Stocks and ETFs Entering their Period of Strength in April

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With the new month upon us and as we celebrate the release of our monthly report for April, today we release our screen of all of the stocks that have gained in every April over their trading history. While we at Equity Clock focus on a three-pronged approach (seasonal, technical, and fundamental analysis) to gain exposure to areas of the market that typically perform well over intermediate (2 to 6 months) timeframes, we know that stocks that have a 100% frequency of success for a particular month is generally of interest to those pursuing a seasonal investment strategy. Below are the results:

And how about those securities that have never gained in this fourth month of the year, here they are:

*Note: None of the results highlighted above have the 20 years of data that we like to see in order to accurately gauge the annual recurring, seasonal influences impacting an investment, therefore the reliability of the results should be questioned. We present the above list as an example of how our downloadable spreadsheet available to yearly subscribers can be filtered.

Sentiment on Friday, as gauged by the put-call ratio, ended bearish at 1.04.