Stock Market Outlook for May 14, 2026
The theme heading into the back half of the second quarter is derailment from seasonal norms as inflationary pressures balloon.
*** 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:
Subscribers Click on the relevant link to view the full profile. Not a subscriber? Signup here.
Stock Highlight: |
|
Formula One Group (NASD:FWONA) Seasonal Chart |
|
Zevra Therapeutics, Inc. (NASD:ZVRA) Seasonal Chart
Veracyte, Inc. (NASD:VCYT) Seasonal Chart
Extreme Networks, Inc. (NASD:EXTR) 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
Another hot inflation report created a bifurcated market on Wednesday as Technology (Semiconductors) snapped back from Tuesday’s decline while other interest rate sensitive groups (Utilities and REITs) ended lower. The S&P 500 Index closed up by just less than six-tenths of one percent, remaining within the short-term rising trend channel that has been carved out in the past couple of weeks. The lower limit of the rising span can be pegged close to 7320. The gaps beneath the market, looked to as levels of support, continue to accumulate, including the big one between 6620 and 6740, and, ultimately, the character of the market remains where levels of resistance hold less weight than levels of support. As the market continues to move higher, so too do downside risks in the near-term, which can now be pegged towards levels around 7000 (the January highs). Momentum indicators continue to show signs of stall around overbought territory and there remains indication of upside exhaustion that could lend to a digestive phase on the horizon, particularly now that we are moving beyond the height to earnings season. In the Seasonal Advantage Portfolio (which is strongly higher YTD, continuing to set new high watermarks) that we manage for clients at CastleMoore, we have been busy moving around over the past few sessions, not by selling out of the market, but rather rotating within in it (more details on that in yesterday’s report). The conflict in Iran remains a wildcard and some of the cues that we have been following that would warrant moving towards a more defensive posture in risk assets continue to trigger. Subscribers can view the themes in our chart books to either Accumulate or Avoid that we continue to gear portfolios towards.
Today, in our Market Outlook to subscribers, we discuss the following:
- US Producer Price Index (PPI)
- Double-top emerging in the Industrial Sector
- Materials showing bifurcated activity: What to buy and what to sell, as well as the pair trade that is working for us
- Treasury yields breaking out
- Rate pressures causing a lag in Existing Home Sales
- Supply/Demand mismatch in the housing market, weighing on the trajectory of prices
- Signs of investor complacency continue
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for May 14
Not signed up yet? Subscribe now to receive full access to all of the research and analysis that we publish
Sentiment on Wednesday, as gauged by the put-call ratio, ended bullish at 0.70.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
| Sponsored By... |
|
