Tech Talk for Monday June 3rd 2024

U.S. equity index futures were higher this morning. S&P 500 futures were up 13 points at 8:30 AM EDT.

Nvidia advanced $26.05 to $1,122.00 after announcing launch of new AI chips

Advanced Micro Devices rose $1.99 to $169.00 after announcing launch of new AI chips.

Edwards Lifesciences gained $2.08 to $88.97 after announced sale of its critical care product group to Becton Dickenson for $4.2 billion.

Paramount Global added $0.80 to $12.73 after Skydance increased its offer to acquire the company.

Equity Clock's Stock Market Outlook for June 3rd

Over the past two decades, the S&P 500 Index has declined by an average of 0.2% in the month of June.

See: https://equityclock.com/2024/06/01/stock-market-outlook-for-june-3-2024/

The Bottom Line

North American equity markets responded favourably to the April core PCE Price Index report released on Friday. Consensus was an increase of 0.3% versus a gain of 0.3% in March. Actual was an increase of 0.2%. On a year-over-year basis, the Index gained 2.8%, in line with consensus. This Index is the Federal Reserves' favoured index for measuring inflation. Economists are guessing that the Fed Fund Rate currently at 5.25%-5.50% could start to decline as early as the FOMC meeting on September 17th -18th .

Other central banks also are contemplating a reduction in their rates. The Bank of Canada is expected to lower its bank rate on Wednesday from 5.00% to 4.75% and the European Central Bank is expected to lower its rate on Thursday from 5.00% to 4.75%.

Consensus for Earnings and Revenues for S&P 500 Companies

Source: www.FactSet.com

Consensus estimates slipped slightly last week:

Ninety eight percent of S&P 500 companies have reported first quarter results to date. Consensus on a year-over-year basis calls for an earnings increase of 5.9% (versus a 6.0% increase last week). Revenues are expected to increase 4.2%.

Earnings gains accelerate in the second and third quarters. Consensus for the second quarter calls for a 9.2% earnings increase (versus 9.3% last week) and a 4.7% increase in revenues.. Consensus for the third quarter calls for an 8.3% increase in earnings and a 4.9% increase in revenues.

Earnings gains accelerate further in the fourth quarter. Consensus for the fourth quarter calls for a 17.5% increase in earnings (versus 17.6% last week) and a 5.5% increase in revenues.

For all of 2024, consensus calls for an 11.3% earnings increase (versus 11.4% last week) and a 5.0% increase in revenues.

Estimated gains for fiscal 2025 unchanged. Consensus calls for a 14.2% earnings increase and a 5.9% revenue increase.

Economic News This Week

Source: www.Investing.com

April U.S. Construction Spending released at 10:00 AM EDT on Monday is expected to increase 0.2% versus a decline of 0.2% I March.

May ISM Manufacturing PMI released at 10:00 AM EDT on Monday is expected to improve to 49.8 from 49.2 in June.

April Factory Orders released at 10:00 AM EDT on Tuesday are expected to increase 0.7% versus a gain of 0.8% in March

Bank of Canada offers its interest rate decision at 9:45 AM EDT on Wednesday. A press conference is scheduled at 10:30 AM EDT. Consensus calls for a drop in the overnight lending rate for major banks from 5.00% to 4.75%.

May ISM Non-manufacturing PMI released at 10:00 AM EDT on Wednesday is expected to improve to 51.0 from 49.4 in April

European Central Bank releases its overnight lending rate decision at 8:15 AM EDT. Consensus calls for a drop in the rate from 4.50% to 4.25%.

April U.S. Trade Deficit released at 8:30 AM EDT on Thursday is expected to increase to $69.80 billion from $69.40 billion in March

April Canadian Trade Balance released at 8:30 AM EDT on Thursday is expected to be a deficit of $2.20 billion versus a deficit of $2.28 billion in March

May U.S. Non-farm Payrolls released at 8:30 AM EDT on Friday are expected to increase to 185,000 versus a gain of 175,000 in April. May Unemployment Rate is expected to remain unchanged from April at 3.9%. May Average Hourly Earnings are expected to increase 0.3% versus a gain of 0.2% in April.

May Canadian Employment is released at 8:30 AM EDT on Friday

Selected Earnings News This Week

Source: www.Investing.com

Seven S&P 500 companies are scheduled to release quarterly results. No TSX 60 companies are scheduled to release quarterly results.

Trader's Corner

Equity Indices and Related ETFs

Daily Seasonal/Technical Equity Trends for May 31st 2024

Green: Increase from previous day

Red: Decrease from previous day

Source for all positive seasonality ratings: www.EquityClock.com

Commodities

Daily Seasonal/Technical Commodities Trends for May 31st 2024

Green: Increase from previous day

Red: Decrease from previous day

Sectors

Daily Seasonal/Technical Sector Trends for May 31st 2024

Green: Increase from previous day

Red: Decrease from previous day

Technical Scores

Calculated as follows:

Intermediate Uptrend based on at least 20 trading days: Score 2

         (Higher highs and higher lows)

Intermediate Neutral trend: Score 0

          (Not up or down)

Intermediate Downtrend: Score -2

          (Lower highs and lower lows)

Outperformance relative to the S&P 500 Index: Score: 2

Neutral Performance relative to the S&P 500 Index: 0

Underperformance relative to the S&P 500 Index: Score -2

Above 20 day moving average: Score 1

At 20 day moving average: Score: 0

Below 20 day moving average: -1

Up trending momentum indicators (Daily Stochastics, RSI and MACD): 1

Mixed momentum indicators: 0

Down trending momentum indicators: -1

Technical scores range from -6 to +6. Technical buy signals based on the above guidelines start when a security advances to at least 0.0, but preferably 2.0 or higher. Technical sell/short signals start when a security descends to 0, but preferably -2.0 or lower.

Long positions require maintaining a technical score of -2.0 or higher. Conversely, a short position requires maintaining a technical score of +2.0 or lower

Changes Last Week

Technical Notes for Friday

DoorDash a NASDAQ 100 stock moved below $109.06 setting an intermediate downtrend.

Datadog a NASDAQ 100 stock moved below $110.34 extending an intermediate downtrend.

AT&T an S&P 100 stock moved above $17.86 extending an intermediate uptrend.

Links offered by valued providers

MUST SEE! Top 10 Stock Picks For June 2024: David Keller

MUST SEE! Top 10 Stock Picks For June 2024 - YouTube

PCE indicates economy ‘inching towards stagflation,’ says Michael Cuggino

PCE indicates economy ‘inching towards stagflation,’ says Michael Cuggino - YouTube

Expect a rate cut on June 5: strategist

Expect a rate cute on June 5: strategist - YouTube

Are We Seeing "Sell in May" Play Out? Mark Leibovit

Are We Seeing "Sell in May" Play Out? - HoweStreet

Hindenburg Omen Flashes Initial Sell Signal David Keller

Hindenburg Omen Flashes Initial Sell Signal | The Mindful Investor | StockCharts.com

Michael Campbell's Money Talks for June 1st

mikes-content (mikesmoneytalks.ca)

Is Canada Already In Recession? Danielle Park

Is Canada Already In Recession? - HoweStreet

Trading Desk Notes For June 1, 2024 Victor Adair

Trading Desk Notes For June 1, 2024 - HoweStreet

Rate cuts will mean recession is upon us Bob Hoye

Rate Cuts Will Mean Recession Is Upon Us - HoweStreet

Technical Scoop from David Chapman and www.EnrichedInvesting.com

https://enrichedinvesting.com/wp-content/uploads/2024/06/Indictment-first-armageddon-belief-precious-benefit-collision-course-market-divergences-weak-energy.pdf

S&P 500 Momentum Barometers

The intermediate term Barometer jumped 8.60 on Friday and gained 1.00 last week to 50.60. It remains Neutral.

The long term Barometer jumped 5.00 on Friday, but slipped 0.40 last week to 72.80. It remains Overbought.

TSX Momentum Barometers

The intermediate term Barometer jumped 5.83 on Friday and added 0.89 last week to 59.19. It remains Neutral.

The long term Barometer advanced 3.59 on Friday, but slipped 0.45 last week to 67.71. It remains Overbought.

Disclaimer: Seasonality ratings and technical ratings offered in this report and at

www.equityclock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed