Stock Market Outlook for February 24, 2025
The weakness that stocks are realizing is entirely normal for the back half of February.
*** 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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Amplify Video Game Tech ETF (AMEX:GAMR) Seasonal Chart
Global X Natural Gas ETF (TSE:HUN.TO) Seasonal Chart
Verisk Analytics Inc. (NASD:VRSK) Seasonal Chart
Trilogy Metals Inc. (TSE:TMQ.TO) Seasonal Chart
BCE, Inc. (NYSE:BCE) Seasonal Chart
AirBoss of America Corp. (TSE:BOS.TO) Seasonal Chart
SBA Communications Corp. (NASD:SBAC) Seasonal Chart
Diana Shipping Inc. (NYSE:DSX) Seasonal Chart
OPENLANE, Inc. (NYSE:KAR) Seasonal Chart
B&G Foods Inc. (NYSE:BGS) Seasonal Chart
The Markets
Stocks sold off on Friday as ongoing uncertainty pertaining to tariffs, macro-economic concerns, and the identification of a new coronavirus had traders on edge. The S&P 500 Index closed lower by 1.71%, unable to hold support at the 6100 hurdle that acted as a cap to upside momentum over the past couple of months. The benchmark is back testing support at the 50-day moving average (6009), reflecting the apparent loss of excitement to buy around present heights and the neutral bias that is desired heading into the weekend. Momentum indicators have negatively diverged from price since the middle of last year, highlighting the waning enthusiasm investors had been expressing towards tech-heavy (Mag-7) benchmarks, like this, amidst extreme valuations. A renewed MACD sell signal was triggered on the day as the momentum indicator crossed below its signal line. Downside risks on a pullback over the near-term are back to the July/August 2024 highs around 5700, a move that would amount to a 7% pullback from recent heights. This would be a healthy and ordinary correction within a bull market by any measure. We continue to monitor the potential impact of the apparent rotation in the market on our list of candidates in the market to Accumulate and to Avoid and we have adopted more of a neutral stance as segments that were previously noted as Accumulate candidates fall off (eg. Technology) and as areas to Avoid are added.
Today, in our Market Outlook to subscribers, we discuss the following:
- Weekly look at the large-cap benchmark
- The defensive tone being adopted by the sectors, as well as examining some of the sector downgrades to look out for
- The downfall of Health Care Provider stocks amidst the fallout from UnitedHealth
- US Existing Home Sales
- Canadian Retail Sales
- The plunge in Retail stocks
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for February 24
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Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.90.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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