Stock Market Outlook for August 12, 2026
Weakness in the housing market threatening the wealth effect (and equity prices).
*** 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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BMO India Equity Index ETF (TSE:ZID.TO) Seasonal Chart
Vanguard U.S. Total Market Index ETF (TSE:VUN.TO) Seasonal Chart
Biohaven Ltd. (NYSE:BHVN) Seasonal Chart
Disclaimer: Comments and opinions offered in this report are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered is believed to be accurate, but is not guaranteed.
The Markets
Further strength in the price of oil, drawing funds towards energy stocks, was sufficient to maintain the stall in the broad market from the past few sessions. The S&P 500 Index slipped by less than a third of one percent, continuing to hold above the consolidation span that the benchmark had been within since the start of June between 7250 and 7620; previous resistance at this upper threshold now turns into support. A short-term bull-flag pattern continues to be charted, suggesting further upside in the near-term to be expected. Implied resistance around 20 and 50-day moving averages (~7500) was broken just over a week ago, placing the ball in the bulls court heading into the start of the new month. Daily momentum indicators remain on an upswing, moving above the declining path that had been charted since the end of May. The technicals are providing all of the characteristics to be bullish of stocks. In the Seasonal Advantage Portfolio that we manage for clients at CastleMoore, we never made any changes in our allocations during the abnormal July weakness. Following a first half performance in the Seasonal Advantage Portfolio that was well ahead of our own benchmark (as well as all major equity benchmarks in the market), we have had a view to expect strength for the start of the second half of the year, aligning with the optimism that the manufacturing economy is expressing. Our stance is now paying off. Earnings season has provided the cover to the headline threats in the market and, ultimately, the positive intermediate-term trajectory of the market persists. Subscribers can view what we are targeting in our list of market segments to either Accumulate or Avoid.
Today, in our Market Outlook to subscribers, we discuss the following:
- S&P 500 remains firmly bullish
- Energy remains an important portfolio theme
- Housing is showing increasing signs of economic stress
- The market is bullish now, but economic risks are building underneath
- Portfolio Implications
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Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.80.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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