Equity Clock

Stock Market Outlook for October 28, 2020

The fuel for the market to move higher through the end of the year may come from short-covering, using the elevated level of credit balances in margin accounts as our guide.

 

 

 

*** 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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Ball Corp. (NYSE:BLL) Seasonal Chart

KB Home (NYSE:KBH) Seasonal Chart

Great Canadian Gaming Corp. (TSE:GC.TO) Seasonal Chart

Raytheon Technologies (NYSE:RTX) Seasonal Chart

Thermo Fisher Scientific Inc. (NYSE:TMO) Seasonal Chart

IGM Financial Inc. (TSE:IGM.TO) Seasonal Chart

CI Financial Corp. (TSE:CIX.TO) Seasonal Chart

Toll Brothers, Inc. (NYSE:TOL) Seasonal Chart

Lennox Intl Inc. (NYSE:LII) Seasonal Chart

J.B. Hunt Transport Services, Inc. (NASD:JBHT) Seasonal Chart

Cooper Tire & Rubber Co. (NYSE:CTB) Seasonal Chart

Brinker Intl, Inc. (NYSE:EAT) Seasonal Chart

Mednax, Inc. (NYSE:MD) Seasonal Chart

Alamo Group, Inc. (NYSE:ALG) Seasonal Chart

Cedar Fair L P (NYSE:FUN) Seasonal Chart

Norbord, Inc. (NYSE:OSB) Seasonal Chart

Nutrien Ltd. (TSE:NTR.TO) Seasonal Chart

First Trust ISE Water Index Fund (NYSE:FIW) Seasonal Chart

iShares Core S&P Mid-Cap ETF (NYSE:IJH) Seasonal Chart

iShares Russell 2000 ETF (NYSE:IWM) Seasonal Chart

Invesco Dynamic Retail ETF (NYSE:PMR) Seasonal Chart

Invesco Dynamic Networking ETF (NYSE:PXQ) Seasonal Chart

Oppenheimer Large Cap Revenue ETF (NYSE:RWL) Seasonal Chart

Vanguard Large-Cap ETF (NYSE:VV) 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 continued to slide on Tuesday, unwilling to show any signs of turnaround that the second day of the trading week has become known for.  The S&P 500 Index closed down by three-tenths of one percent, charting another close below its 50-day moving average.  The benchmark broke firmly below its rising 20-day moving average during Monday’s session, placing cracks in the short-term trend as overhead resistance at 3588 continues to weigh.  Momentum indicators continue to push lower, following through with the MACD sell signal that was recorded last week.  The volatility index continues to climb with the fear-gauge closing at the second highest level in the past four months.  Uncertainty ahead of the election, hesitation ahead of some major earnings, ambiguity over the size and timing of another stimulus bill, and uneasiness over the rise in the number of coronavirus cases are all factors weighing on the market.

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 the economic front, a report on durable goods orders was released before Tuesday’s session. The headline print of the September report indicated that new orders in the US increased by 1.9% last month, which was much stronger than the consensus analyst estimate that called for an increase of 0.4%.  Core capital goods orders, meanwhile, showed an increase of 1.0%, which was double the consensus analyst estimate that called for a rise of 0.5%.  Stripping out the seasonal adjustments, the value of manufacturers’ new orders for durable goods industries actually increased by 6.7% in September, which is stronger than the 5.6% rise that is average for this time of year.  The year-to-date change is now higher on the year by 1.7%, which is just shy of the 2.4% increase that is average through the first three-quarters.   We sent out further insight to subscribers intraday.  Subscribe now.

Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.80.  The Dark Index, which we have been referring to frequently in recent days/weeks, ended at 41%, still well below the threshold that we desire to see of 45%.

 

 

Seasonal charts of companies reporting earnings today:

 

 

S&P 500 Index

 

 

TSE Composite

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