Stock Market Outlook for November 2, 2023
Stocks are unwinding an extreme bearish bias that built up in the market in recent weeks, ahead of the best six months of the year timeframe for the asset class.
*** 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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Lincoln Educational Services Corp. (NASD:LINC) Seasonal Chart
iShares Global Industrials ETF (NYSE:EXI) Seasonal Chart
Arista Networks, Inc. (NYSE:ANET) Seasonal Chart
Sun Life Financial Services of Canada, Inc. (TSE:SLF.TO) Seasonal Chart
Assertio Holdings (NASD:ASRT) Seasonal Chart
Analog Devices, Inc. (NASD:ADI) Seasonal Chart
Pizza Pizza Royalty Corp. (TSE:PZA.TO) Seasonal Chart
Wipro Ltd. (NYSE:WIT) Seasonal Chart
Uranium Energy Corp. (AMEX:UEC) Seasonal Chart
Mercer Intl, Inc. (NASD:MERC) Seasonal Chart
Fortinet Inc. (NASD:FTNT) Seasonal Chart
The Markets
Stocks rallied on Wednesday as investors reacted favourably to the latest FOMC announcement that highlighted the continuation of a pause in interest rates following over a year of aggressive hikes. The S&P 500 Index gained just over one percent, continuing to cement support at the lower limit of the band of significance between 4100 and 4200. The benchmark is now at a point of possible resistance at the 200-day moving average at 4243, which could easily give investors pause in the near-term. The 20-day moving average, now at 4269, is increasingly encroaching on the long-term average in what could amount to a bearish crossover in the days ahead. Momentum indicators are on the rebound, showing a divergence versus price ahead of the strength in stocks this week, but characteristics of a bearish trend remain with both MACD and RSI holding below their middle lines. The risk-reward still appears favoruable to accumulating risk (stocks) in the 4100 to 4200 zone, but, as has been highlighted in our reporting, the sustainability of the advance from this significant zone of support is questionable. The short-term trend remains negative, defined by lower-highs and lower-lows, and the intermediate path remains around a pivotal point at the aforementioned span.
Today, in our Market Outlook to subscribers, we discuss the following:
- Investment manager positioning/sentiment
- Manage money exposure to S&P 500 Futures has flipped net long
- Short position in treasury bond futures rebounding from record levels
- Intermediate treasury note prices
- Job Openings and Labor Turnover Survey (JOLTS) and the investment themes within
- US Construction Spending and what it has to say about stocks with exposure
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for November 2
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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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