Stock Market Outlook for January 4, 2024
The positivity rate of influenza-like-illnesses being treated at health care providers at the end of 2023 was the second highest on record for this time of year.
*** 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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Invesco S&P/TSX Composite Low Volatility Index ETF (TSE:TLV.TO) Seasonal Chart
ProShares VIX Short-Term Futures ETF (NYSE:VIXY) Seasonal Chart
ZTO Express (Cayman) Inc. (NYSE:ZTO) Seasonal Chart
Invesco DWA Consumer Cyclicals Momentum ETF (NASD:PEZ) Seasonal Chart
iShares Edge MSCI Minimum Volatility USA ETF (AMEX:USMV) Seasonal Chart
iShares Russell 3000 ETF (NYSE:IWV) Seasonal Chart
Invesco Ultra Short Duration ETF (NYSE:GSY) Seasonal Chart
Computer Modelling Group Ltd. (TSE:CMG.TO) Seasonal Chart
Provident Financial Holdings, Inc. (NASD:PROV) Seasonal Chart
Ellington Financial Inc. (NYSE:EFC) Seasonal Chart
Zumiez Inc. (NASD:ZUMZ) Seasonal Chart
Valmont Industries, Inc. (NYSE:VMI) Seasonal Chart
BMO Equal Weight REITs Index ETF (TSE:ZRE.TO) Seasonal Chart
Universal Health Services – Class B (NYSE:UHS) Seasonal Chart
The Markets
Stocks are failing to follow through with the gains that were achieved in the last two months of 2023 as traders use the new year to finally book profits. The S&P 500 Index shed eight-tenths of one percent, giving up the gain that is associated with the notorious Santa Claus rally period that, according to our research, runs from December 15th to January 6th. The benchmark is back testing short-term support at its 20-day moving average close to 4700, providing an initial point of reference for short-term traders to pin their bets off of. The more logical level of support upon the continuation of weakness is down to previous resistance, now support, at 4600. Momentum indicators are rolling over from overbought territory and MACD remains on a short-term sell signal following last week’s bearish crossover of its signal line. While the precedent of failed Santa Claus rally periods is not encouraging for the market prospects through the month, quarter, and year ahead, ultimately the performance of stocks is dependent on how the economy performs and whether it can avoid a recession that many leading economic indicators are pointing to.
Today, in our Market Outlook to subscribers, we discuss the following:
- The make or break point for the Shanghai Composite and the broader emerging market trade
- Oil defending significant support and the short-term head-and-shoulders bottoming pattern on the chart of the Energy ETF
- Job Openings and Labor Turnover Survey (JOLTs)
- The spread of respiratory illnesses versus the seasonal norm
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for January 4
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Sentiment on Wednesday, as gauged by the put-call ratio, ended slightly bearish at 1.07.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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