Stock Market Outlook for July 21, 2023
The bearish fundamentals behind Natural Gas may have alleviated just in time for its period of seasonal strength.
*** 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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ProShares S&P 500 Dividend Aristocrats ETF (NYSE:NOBL) Seasonal Chart
WisdomTree LargeCap Dividend Fund (NYSE:DLN) Seasonal Chart
BMO Aggregate Bond Index ETF (TSE:ZAG.TO) Seasonal Chart
SkyWest, Inc. (NASD:SKYW) Seasonal Chart
Fidelity MSCI Consumer Staples Index ETF (AMEX:FSTA) Seasonal Chart
Invesco BuyBack Achievers ETF (NASD:PKW) Seasonal Chart
BMO S&P/TSX Equal Weight Industrials Index ETF (TSE:ZIN.TO) Seasonal Chart
Gallagher Arthur J & Co. (NYSE:AJG) Seasonal Chart
BMO S&P/TSX Equal Weight Banks Index ETF (TSE:ZEB.TO) Seasonal Chart
Assurant Inc. (NYSE:AIZ) Seasonal Chart
Teucrium Sugar Fund (NYSE:CANE) Seasonal Chart
The Markets
Stocks slipped on Thursday as investors expressed their disappointment to earnings from some notable NASDAQ listed entities, namely Netflix (NFLX) and Tesla (TSLA). The S&P 500 Index closed lower by just less than seven-tenths of one percent, falling out of overbought territory, according to the Relative Strength Index (RSI). Support remains solid below at the rising 20-day moving average, now at 4444. Momentum indicators continue to retain characteristics of a bullish trend above their middle lines, however, a divergence with respect to MACD remains ongoing as buying demand wanes around these 52-week high levels. The benchmark reached within 22 points of our proposed summer rally target of 4600 and based on the fact that the largest segment of the market, technology, is now showing signs of rolling over, we may have just seen the peak to the summer rally trade. Seasonally, beyond the first few weeks of July, performance of stocks tends to show lacklustre results through September, as depicted in the real-time seasonal charts at the bottom of this report. It is important that whatever equity exposure is maintained through this period of volatility ahead that seasonal and fundamental justification exists.
Today, in our Market Outlook to subscribers, we discuss the following:
- Waning momentum in the technology sector
- The renewed desire to equal weight equity portfolios
- Health Care
- Weekly Jobless Claims and the health of the labor market
- Manufacturer sentiment
- US Existing Home Sales
- The seasonal trade in Natural Gas
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for July 21
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Sentiment on Thursday, as gauged by the put-call ratio, ended bullish at 0.82.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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