Stock Market Outlook for February 12, 2024
S&P 500 Index has crossed above the psychologically important 5000 level, but with trend channel resistance being tested and seasonality about to turn negative, the market could have a tough time ahead.
*** 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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Brookfield Asset Management Inc. (NYSE:BAM) Seasonal Chart
Teekay Tankers Ltd. (NYSE:TNK) Seasonal Chart
TETRA Technologies (NYSE:TTI) Seasonal Chart
Air Products and Chemicals, Inc. (NYSE:APD) Seasonal Chart
CNX Resources Corp. (NYSE:CNX) Seasonal Chart
Southwestern Energy Co. (NYSE:SWN) Seasonal Chart
Invesco Global Water ETF (NASD:PIO) Seasonal Chart
iShares MSCI Eurozone ETF (NYSE:EZU) Seasonal Chart
iShares S&P GSCI Commodity-Indexed Trust (NYSE:GSG) Seasonal Chart
FMC Corp. (NYSE:FMC) Seasonal Chart
iShares MSCI France ETF (NYSE:EWQ) Seasonal Chart
Healthcare Leaders Income ETF (TSE:HHL.TO) Seasonal Chart
Thomson Reuters Corp. (TSE:TRI.TO) Seasonal Chart
The Markets
Ongoing strength in growth stocks pushed the S&P 500 Index beyond the psychologically important 5,000 level to end the week as the positivity that surrounds the first half of February continues. The large-cap benchmark added nearly six-tenths of one percent, easily crossing above the milestone level and achieving yet another all-time high. The benchmark continues to push further into overbought territory, according to the Relative Strength Index (RSI), but this hasn’t stopped traders from buying into the technology euphoria that surrounds the Artificial Intelligence boom. Major moving averages continue to rise above one another, supporting prices, and momentum indicators are holding above their middle lines, both characteristics of a bullish intermediate-term trend. But while the technicals of the S&P 500 Index, on their own, are far from being bearish, now that the pull from achieving the important round number is complete, we can at least start to contemplate the prospect of some type of correction following the strong three and a half month run. The last two weeks of February are one of the weakest periods of the year for stocks as traders start to digest the gains that can materialize around the fourth quarter earnings season that has now past its peak. Any evidence of upside exhaustion in the market through the week ahead may warrant pulling back a bit from risk exposure while we wait for the next seasonal rise in stocks during March and April.
Today, in our Market Outlook to subscribers, we discuss the following:
- Weekly look at the large-cap benchmark
- The difficulty the market is showing expanding equity market strength beyond just growth (technology and communication services)
- Canada Labour Force Survey
- Record setting population growth working to mitigate an economic recession
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for February 12
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Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.84.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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