Stock Market Outlook for August 16, 2024
Consumer spending snapped back in July, but a more discerning consumer mentality remains.
*** 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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iShares MSCI Global Energy Producers ETF (AMEX:FILL) Seasonal Chart
iShares Core MSCI Pacific ETF (AMEX:IPAC) Seasonal Chart
Krystal Biotech, Inc. (NASD:KRYS) Seasonal Chart
Ross Stores, Inc. (NASD:ROST) Seasonal Chart
Orix Corp. (NYSE:IX) Seasonal Chart
LPL Financial Holdings Inc. (NASD:LPLA) Seasonal Chart
Balchem Corp. (NASD:BCPC) Seasonal Chart
Pure Storage, Inc. (NYSE:PSTG) Seasonal Chart
TotalEnergies SE (NYSE:TTE) Seasonal Chart
Global X Lithium ETF (NYSE:LIT) Seasonal Chart
BMO MSCI Emerging Markets Index ETF (TSE:ZEM.TO) Seasonal Chart
The Descartes Systems Group, Inc. (TSE:DSG.TO) Seasonal Chart
MakeMyTrip Ltd. (NASD:MMYT) Seasonal Chart
Nexstar Media Group, Inc. (NASD:NXST) Seasonal Chart
Aecom Technology Corp. (NYSE:ACM) Seasonal Chart
The Markets
Stocks surged on Thursday, moving beyond their recent volatility shock, following the release of a much stronger than expected read of retail sales for the month of July. The S&P 500 Index closed higher by 1.61%, gaping above implied resistance at the 50-day moving average (5460) that threatened to cap the short-term rebound from the August 5th low. The rising intermediate-term trend of the equity market remains alive, for now, as the benchmark shows little effort breaking down levels of resistance overhead. Short-term resistance at the August high of 5566 is now the test, after which the all-time high at 5669 is the hurdle to watch. The degradation in economic fundamentals in recent months has risked resulting in higher than average volatility through this period of weakness for stocks in August, September, and October, and the desire is to continue to lean on the side of caution in risk assets so long as the macro economic backdrop expresses uncertainty. Longer-term momentum of stocks can be seen waning and the recent “shock in stocks” amidst the short-volatility collapse is likely to remain fresh on investor minds as we head into the heart of this erratic timeframe for the equity market over the next eight or nine weeks. No reason to stretch out on the risk spectrum with seasonal, fundamental, and technical uncertainties present.
Today, in our Market Outlook to subscribers, we discuss the following:
- Market internals suggest that a defensive bias remains in positioning
- US Retail Sales
- Retailer Inventories
- Visa Spending Momentum Index
- Weekly Jobless Claims and the health of the labor market
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for August 16
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Sentiment on Thursday, as gauged by the put-call ratio, ended around neutral at 0.97.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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