Equity Clock

Stock Market Outlook for July 15, 2020

Stocks continue to hold short-term levels of support as the average summer rally period nears its conclusion.

 

 

*** 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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Archer Daniels Midland Co. (NYSE:ADM) Seasonal Chart

Aimia Inc. (TSE:AIM.TO) Seasonal Chart

Cathay Bancorp, Inc. (NASD:CATY) Seasonal Chart

Alaska Air Group, Inc. (NYSE:ALK) Seasonal Chart

Genworth MI Canada Inc. (TSE:MIC.TO) Seasonal Chart

Sarepta Therapeutics, Inc. (NASD:SRPT) Seasonal Chart

iShares Canadian Short Term Bond Index ETF (TSE:XSB.TO) Seasonal Chart

iShares Core Growth Allocation ETF (NYSE:AOR) Seasonal Chart

iShares Gold Trust (NYSE:IAU) Seasonal Chart

SPDR Blackstone – GSO Senior Loan ETF (AMEX:SRLN) Seasonal Chart

 

 

The Markets

Stocks closed firmly higher on Tuesday, erasing the loss from the previous session that saw investors flee from technology stocks.  The S&P 500 Index added 1.34%, ending near the high of the session.  The benchmark tested support at the rising 20-day moving average at the low of the session, starting to firm the start of a short-term rising trend. The benchmark fell short of surpassing important psychological resistance at 3200.  Momentum indicators remain on buy signals following last week’s bullish crossover with respect to MACD.  In our report to subscribers today, we highlight an interesting precedent that could provide a clue as to whether the seasonal trade in gold will work this year, as well as a strategy to remain long equities beyond the summer rally period, while mitigating volatility.  Subscribe now.

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.

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On the economic front, the consumer price index (CPI) for June was released before Tuesday’s opening bell.  The headline print of the inflation gauge indicated that prices increased by 0.6% last month, slightly stronger than the 0.5% increase that was expected.  Less food and energy, the increase was more muted at 0.2%, also slightly stronger than the 0.1% increase that was expected by analysts.  Stripping out the seasonal adjustments, CPI actually increased by 0.5%, driven by above average increases in food, transportation, medical care, personal care, and computer prices.  The average increase in the aggregate read of inflation for the month of June is 0.2%.  The year-to-date change is now higher by a mere 0.3%, which is the weakest change through the first half of the year since 1986.  On average, CPI rises by 2.2% through the first six months of the year.  Subscribers can login to the chart database to view all of the seasonal charts for this report at the following link: https://charts.equityclock.com/u-s-consumer-price-index-cpi-producer-price-index-ppi

Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.85.

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

TSE Composite

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