Stock Market Outlook for September 5, 2024
The yield curve is normalizing with the 10-year treasury yield moving back above the 2-year, typically a coincident indication of the start of an economic recession and corresponding downfall of stocks.
*** 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:
Subscribers Click on the relevant link to view the full profile. Not a subscriber? Signup here.
Griffon Corp. (NYSE:GFF) Seasonal Chart
Simpson Mfg Co, Inc. (NYSE:SSD) Seasonal Chart
Bar Harbor Bankshares, Inc. (AMEX:BHB) Seasonal Chart
SPDR Global Dow ETF (NYSE:DGT) Seasonal Chart
iShares MSCI EAFE ESG Optimized ETF (NASD:ESGD) Seasonal Chart
iShares International Dividend Growth ETF (AMEX:IGRO) Seasonal Chart
SPDR Russell 1000 Low Volatility Focus ETF (AMEX:ONEV) Seasonal Chart
IQ 500 International ETF (AMEX:IQIN) Seasonal Chart
The Markets
Stocks struggled to get off the floor for a second day as investors reacted to weaker than expected read of job openings for the month of July. The S&P 500 Index closed with a loss of almost two-tenths of one percent, continuing to roll over from implied resistance between 5622 and 5658, representing the July 17th downside gap. A short-term peak has become confirmed as the bulls show their reluctance adding to risk at current heights and now we have to scrutinize the risk that the intermediate-term double-top pattern is showing. The chart setup sets the stage for the declines that are normal for stocks during the month of September, a framework that would be confirmed by a breakdown back below support at 20 and 50-week moving averages around 5500. MACD has crossed back below its signal line, confirming the negative divergence versus price that has highlighted the waning of buying demand heading into the traditionally weak month for equity market performance in September. Caution in risk assets remains appropriate, particularly while within this period of seasonal volatility and while the fundamental backdrop appears uncertain.
Today, in our Market Outlook to subscribers, we discuss the following:
- Defensive sectors are winning
- Contrasting paths of Low Volatility and High Beta
- The normalization of the yield curve
- Short end of the treasury yield curve still firmly inverted
- Job Openings and Labor Turnover Survey (JOLTS) and the investment implications the results are portraying
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for September 5
Not signed up yet? Subscribe now to receive full access to all of the research and analysis that we publish.
Sentiment on Wednesday, as gauged by the put-call ratio, ended close to neutral at 0.98.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
| Sponsored By... |
|
