Stock Market Outlook for August 25, 2025
Commodities undervalued and small caps underowned.
*** 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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Business First Bancshares, Inc. (NASD:BFST) Seasonal Chart
SPDR Russell 1000 Yield Focus ETF (AMEX:ONEY) Seasonal Chart
Invesco S&P SmallCap Materials ETF (NASD:PSCM) Seasonal Chart
iShares U.S. Financial Services ETF (NYSE:IYG) Seasonal Chart
Harley Davidson Inc (NYSE:HOG) Seasonal Chart
American Airlines Group Inc. (NASD:AAL) Seasonal Chart
General Motors Co. (NYSE:GM) Seasonal Chart
8×8, Inc. (NASD:EGHT) Seasonal Chart
Gran Tierra Energy Inc. (TSE:GTE.TO) Seasonal Chart
Cenovus Energy Inc. (TSE:CVE.TO) Seasonal Chart
Phillips 66 (NYSE:PSX) Seasonal Chart
Alaska Air Group, Inc. (NYSE:ALK) Seasonal Chart
Methanex Corp. (TSE:MX.TO) Seasonal Chart
Ryder System, Inc. (NYSE:R) Seasonal Chart
Pro-Dex, Inc. (NASD:PDEX) Seasonal Chart
iShares Currency Hedged MSCI Japan ETF (AMEX:HEWJ) Seasonal Chart
iShares U.S. Consumer Services ETF (NYSE:IYC) Seasonal Chart
Costco Wholesale Corp. (NASD:COST) Seasonal Chart
Expeditors Intl of Washington, Inc. (NYSE:EXPD) Seasonal Chart
TEGNA Inc. (NYSE:TGNA) Seasonal Chart
Sterling Infrastructure, Inc. (NASD:STRL) Seasonal Chart
The Markets
Traders pushed back into stocks on Friday as Jerome Powell’s Jackson Hole speech ignited investor optimism that a continuation of the rate cutting cycle is on the horizon. The S&P 500 Index ended higher by 1.52%, moving back to the record highs charted in the prior week just below 6500. The bears are having difficulty sustaining the levels below the 20-day moving average (6385), an important hurdle for the short-term trend of prices off of the April lows. Momentum indicators are still showing negative divergences versus price where lower-highs below July’s overbought extremes have been charted for RSI and MACD. The result gives strong evidence of buying exhaustion, once again lending itself to the onset of a digestion of prices aligning with the period of volatility for the equity market. As has been emphasized, this is the time to be on your toes given the well known volatile period that this time of year is notorious for. As equity markets destabilize from their summer strength, looking for opportunities to peel back risk in portfolios has become appropriate in order to mitigate the erratic moves that impacts stocks in the final months of the third quarter (August/September). The strategy remains to avoid being aggressive in risk (stocks) in the near-term, but take advantage of any volatility shocks (should they materialize) to increase the risk profile of portfolios ahead of the best six months of the year for stocks that gets underway in October. Our list of candidates in the market that are worthy to Accumulate or Avoid continues to be dialed in appropriately, keeping investors tuned into those segments of the market that are working according to our three-pronged approach incorporating seasonal, technical, and fundamental analysis.
Today, in our Market Outlook to subscribers, we discuss the following:
- Weekly look at the large-cap benchmark
- Small Cap stocks
- Financial/Bank stocks
- Canada Retail Sales
- Canadian Dollar
- The decline of the US Dollar Index
- Bullish engulfing candlestick on the commodity tracking fund
- Natural Gas on our radar
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Sentiment on Friday, as gauged by the put-call ratio, ended bullish at 0.83.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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