Stock Market Outlook for June 1, 2021
The S&P 500 Index has tended to weaken in the month of June, falling by an average of 0.6% over the past two decades and closing higher in only 55% of periods.
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*** 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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Bank of Montreal (TSE:BMO.TO) Seasonal Chart
Laurentian Bank Of Canada (TSE:LB.TO) Seasonal Chart
Realty Income Corp. (NYSE:O) Seasonal Chart
National Retail Properties Inc. (NYSE:NNN) Seasonal Chart
Weingarten Realty Investors (NYSE:WRI) Seasonal Chart
Oxford Industries Inc. (NYSE:OXM) Seasonal Chart
Urstadt Biddle Properties Inc. (NYSE:UBA) Seasonal Chart
Ally Financial Inc. (NYSE:ALLY) Seasonal Chart
FibroGen, Inc. (NASD:FGEN) Seasonal Chart
Johnson & Johnson (NYSE:JNJ) Seasonal Chart
Gilead Sciences, Inc. (NASD:GILD) Seasonal Chart
ScanSource, Inc. (NASD:SCSC) Seasonal Chart
Coca-Cola Consolidated, Inc. (NASD:COKE) Seasonal Chart
Direxion Daily Retail Bull 3x Shares (NYSE:RETL) Seasonal Chart
Harley Davidson Inc (NYSE:HOG) Seasonal Chart
Canadian Imperial Bk Comm (NYSE:CM) Seasonal Chart
Marathon Gold Corp. (TSE:MOZ.TO) Seasonal Chart
iShares S&P 100 ETF (NYSE:OEF) Seasonal Chart
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Note: Given that US markets will be closed on Monday for the Memorial Day Holiday, our next report will be released on Tuesday.
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The Markets
Stocks closed mildly higher in the last trading session of the month as investors kept major benchmarks pinned to levels around their 20-day moving averages. The S&P 500 Index tacked on just less than a tenth of one percent, continuing this very slight gyration above the short-term moving average over the past week. The benchmark remains within the limits of its rising intermediate-term trend channel that spans between 4100 and 4300. Short term resistance around 4220 is becoming apparent, but the intermediate path remains that of higher-highs and higher lows. Momentum indicators have started to point higher, even triggering a renewed buy signal with respect to MACD in the previous session.
For the month of June, the S&P 500 Index has lost an average of 0.6% with positive results realized in just 55% of periods over the past two decades. Returns have ranged from a loss of 8.6% in June of 2008 to a gain of 6.9% in June of 2019. The month is a transition period as portfolio managers rebalance their books and prepare for the quarter ahead and the second half of the year. Read more in our monthly report on how to position in this final month of the second quarter. Subscribe now.
Just Released…
Our Monthly Outlook for June is now out, providing all of the insight that you require to position in this market through the month(s) ahead.
Highlights in this report include:
- Equity market tendencies in the month of June
- Prices rising at a rapid pace
- Commodity sensitive segments of the economy breaking out
- Commodity benchmark breaks out after 13 years of declines
- Strong manufacturing demand the driver of prices
- The strength of wages hints that inflationary pressures are not merely transitory
- Help wanted signs are plentiful, but Americans still reluctant to head back to work
- Strong commodity demand calls for benchmarks influenced by the positive trajectory of prices
- Will inflationary pressures finally bring an end to the multi-decade long bond market bull run?
- REITs
- Shift towards inflationary themes coming at the expense of growth sectors (eg. Technology)
- The fundamental case for the technology sector
- Canadian Dollar
- Time to ship out of the US to opportunities overseas?
- The decline in new case counts of COVID globally
- The strength of the consumer
- No longer able to be constructive on the homebuilders
- The technical status of the S&P 500 Index
- Positioning for the months ahead
- Sector reviews and ratings
- Stocks that have frequently gained in the month of June
- Notable stocks and ETFs entering their period of strength in June
Look for this report in your inbox.Â
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With the new month now upon us and as we celebrate the release of our monthly report for June, today we release our screen of all of the stocks that have gained in every June 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:
*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 can be filtered.
In January, we announced that we had added the monthly average returns and monthly frequency of gains for each investment to our downloadable spreadsheet that is available to yearly subscribers (if you are a monthly subscriber and have been with us for over a year, feel free to reach out to us to request a copy). The inclusion of this data allows for more detailed data mining all from the convenience of a filterable spreadsheet. The possibilities are endless. Filter the results down to all the stocks in the market with at least 20 years of data that have gained in at least 80% of Junes, find all of the stocks that show an optimal holding period that begins in July with strong average returns in August and September, or drill down to all of the stocks that correlate strongly with the period of seasonal strength for the sector in which it is categorized. We continue to look for opportunities to include the results of some filters that our audience may find of interest in our regular reports. Annual subscribers can login and download this spreadsheet in the “Download†section of the chart database at https://charts.equityclock.com/.
Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.73.
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Seasonal charts of companies reporting earnings today:
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S&P 500 Index
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TSE Composite
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