Stock Market Outlook for July 20, 2026
Manufacturers are the most optimistic heading into the second half of the year than they have been in the past four decades.
*** 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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Stock Highlight: |
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Sprott Physical Gold Silver Trust (TSE:CEF.TO) Seasonal Chart |
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Invesco S&P SmallCap Low Volatility ETF (AMEX:XSLV) Seasonal Chart
Vanguard High Dividend Yield ETF (NYSE:VYM) Seasonal Chart
Pursuit Attractions and Hospitality, Inc. (NYSE:PRSU) Seasonal Chart
WisdomTree LargeCap Dividend Fund (NYSE:DLN) Seasonal Chart
Aflac, Inc. (NYSE:AFL) Seasonal Chart
RLI Corp. (NYSE:RLI) Seasonal Chart
Primerica Inc. (NYSE:PRI) Seasonal Chart
Arrow Financial Corp. (NASD:AROW) 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, a sharply negative reaction to earnings from Netflix (NFLX), and uncertainty in the AI trade following the announcement of a new AI model out of China pressured stocks into the end of the week. The S&P 500 Index fell by 1.01%, continuing to trade below short-term double-top resistance at 7580 and reaching back to the lower limit of the short-term trading range between 7425 and 7550. The move obviously clouds the looming resolution of the range that earlier in the week projected a move towards 7675. Support on the daily chart is being maintained around 20 and 50-day moving averages (~7464), which have converged on one another in a bearish manner. Daily momentum indicators have rolled over again with MACD triggering a fresh sell signal, now aligning with the end of the summer rally period that peaks on July 17th, on average. In the Seasonal Advantage Portfolio that we manage for clients at CastleMoore, we remain positioned in a bullish manner. 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 are still anticipating strength for the start of the second half of the year, despite the recent uptick in volatility, but we are scrutinizing the risks that have abruptly escalated with the increase in geopolitical tensions. The start of earnings season provides some cover to the headline threats. 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:
- Weekly look at the large-cap benchmark
- A look back at the results of the summer rally period and what they could mean for stocks over the next year
- Average performance of stocks through the remainder of July and how we see the market as we exit the summer rally phase
- US Industrial Production and the investment implications within
- Manufacturer sentiment and the sectors to look to for exposure amidst the present backdrop
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Sentiment on Friday, as gauged by the put-call ratio, ended close to neutral at 0.94.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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