Stock Market Outlook for March 19, 2025
The consumer economy is on a fragile footing following the second largest February drawdown on record for US retail sales.
*** 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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iShares Global Infrastructure Index ETF (NASD:IGF) Seasonal Chart
ProMIS Neurosciences Inc. (NASD:PMN) Seasonal Chart
Tortoise Pipeline & Energy Fund, Inc. (NYSE:TTP) Seasonal Chart
SPDR Dow Jones Global Real Estate ETF (NYSE:RWO) Seasonal Chart
AGNC Investment Corp. (NASD:AGNC) Seasonal Chart
SPDR S&P Global Infrastructure ETF (NYSE:GII) Seasonal Chart
First Trust Natural Gas ETF (NYSE:FCG) Seasonal Chart
Brookfield Global Infrastructure Securities Income Fund (TSE:BGI/UN.TO) Seasonal Chart
Annaly Capital Management, Inc. (NYSE:NLY) Seasonal Chart
The Markets
Weakness in the Maginifcent-7 stocks worked to drag on the tech-heavy S&P 500 Index on Tuesday as the broader equity market attempts to solidify the near-term lows that were charted last week. The S&P 500 Index closed down by 1.07%, remaining below support around the 200-day moving average (5743). The declining short-term path from the past month remains violated now that price has moved above trendline resistance that constrained the lower-lows and lower-highs since the end of February. A check-back of the now declining resistance at the 50-day moving average (5933) is reasonable and likely, at which point the true health of the intermediate-term trajectory of stocks can be determined. Markets that are showing greater resistance than support must be avoided, a framework, on an intermediate-term scale, we have not seen yet. Momentum indicators on the daily chart 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. For now, the drawdown in the market can still be viewed as healthy and ordinary within a bull market, by any measure, but scrutiny is certainly warranted now that some critical levels have been lost, such as 5700 on the S&P 500. Below this threshold, more dire scenarios for risk assets must be considered. 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:
- Looking for stability in Mag-7 stocks
- Nothing yet to indicate that the rebound attempt in the market that began at the end of last week is over
- US Retail Sales and the investment implications within
- Retailer inventories
- Lowest level of spending momentum since the height of the pandemic
- Retail stocks
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Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.78.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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