Tech Talk for Monday March 25th 2024
U.S. equity index futures were lower this morning. S&P 500 futures were down 15 points at 8:30 AM EDT.
United Airlines dropped $1.83 to $66.34 after the FAA launched an increased oversight on the company's operations.
Walt Disney added $1.33 to $117.20 after Barclay's upgraded the stock to Overweight.
Zoom added $0.38 to $66.34 after the company launched Zoom Workplace.
Masimo advanced $17.87 to $152.90 after an activist announced plans to increase his number of seats on the company's board.
The Bottom Line
Responses by North American equity market to FOMC news released last Wednesday were a pleasant surprise. S&P 500 Index and Dow Jones Industrial Average quickly moved to all-time highs. The TSX Composite Index tested its all-time high at 22,213.07 set on April 5th 2022. Responses were triggered by comments by Federal Reserve Chairman Powell implying that inflation pressures are coming down: He predicted that the Fed Fund Rate at 5.25%-5.50% will move lower by the end of the year.
Predictions by the FOMC, that upside inflationary pressures in the U.S. are declining, are pre-mature at best. Despite a gain by the U.S. Dollar Index last week by 1.37 to 104.43, commodity prices, particularly agriculture, lumber and base metals prices continued to stream higher. Efforts by the FOMC and Bank of Canada to lower inflation pressures are far from over, not a scenario that is favourable for higher equity prices.
Other than investment in commodity and commodity stocks, better opportunities are available in equity markets outside of North America where efforts by the FOMC and Bank of Canada to reduce inflation pressures are not an issue. Possibilities include investing in Exchange Traded Funds representing countries and regions outside of North America.
Note that the US 0.55 cent drop by the Canadian Dollar last week to a four month low at US73.47 cents is positive for the earnings of Canadian commodity producers selling products to the U.S.
Consensus for Earnings and Revenues for S&P 500 Companies
Source: www.FactSet.com
Analysts slightly increased estimates for the first quarter of 2024. Consensus on a year-over-year basis calls for an earnings increase of 3.4% (versus a 3.3% increase last week). Revenues are expected to increase 3.6% (versus a 3.5% increase last week).
Earnings gains accelerate thereafter to the end of 2024. Consensus for the second quarter calls for a 9.3% earnings increase (versus a 9.1% increase last week) and a 4.7% increase in revenues (versus a 4.6% increase last week). Consensus for the third quarter calls for an 8.4% increase in earnings (versus a previous 8.3% increase) and a 5.1% increase in revenues. Consensus for the fourth quarter calls for a 17.4% increase in earnings (versus a previous 17.3% increase) and a 5.8% increase in revenues. For all of 2024, consensus calls for an 10.9% increase in earnings (versus a previous increase of 11.0%) and a 5.1% increase in revenues (versus a previous 5.0% increase)
Preliminary estimates were offered for fiscal 2025. Consensus calls for a 13.3% earnings increase (versus previous 13.2% increase) and a 5.9% revenue increase.
Economic News This Week
Source: www.Investing.com
February U.S. New Home Sales released at 10:00 AM EDT on Monday are expected to increase to 673,000 from 661,000 in January
February Durable Goods Orders released at 8:30 AM EDT on Tuesday are expected to increase 1.0 versus a decline of 6.1% in January.
Updated Annualized Fourth quarter U.S. GDP released at 8:30 AM EDT on Thursday is expected to increase 3.2% versus a gain of 4.9% in the third quarter.
Canada's GDP in January released at 8:30 AM EDT on Thursday is expected to increase 0.4% versus unchanged in December
March Michigan Sentiment released at 10:00 AM EDT on Friday is expected to increase to 77.0 from 76.9 in February.
Selected Earnings News This Week
Source: www.Investing.com
Trader's Corner
Equity Indices and Related ETFs
Daily Seasonal/Technical Equity Trends for March 22nd 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 March 22nd 2024
Green: Increase from previous day
Red: Decrease from previous day
Sectors
Daily Seasonal/Technical Sector Trends for March 22nd 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
Links offered by valued providers
Mike's Money Talks for March 23rd
Michael Campbell's MoneyTalks - Complete Show (mikesmoneytalks.ca)
Apple’s Antitrust Woes: Impact on Market: Dave Keller
Apple’s Antitrust Woes: Impact on Market - YouTube
Top 5 Stocks Opportunities Revealed! TG Watkins
Top 5 Stocks Opportunities Revealed! - YouTube
Look Out Below! The Bear Case For Apple: David Keller
Look Out Below! The Bear Case For Apple | The Mindful Investor | StockCharts.com
Rates Look Set to Rise as TLT Resumes its Downtrend: Arthur Hill
Rates Look Set to Rise as TLT Resumes its Downtrend | Art’s Charts | StockCharts.com
Energy: A Long-Term Turnaround in Relative Strength is Brewing: Julius de Kempenaer
Energy: A Long-Term Turnaround in Relative Strength is Brewing | RRG Charts | StockCharts.com
Energy Heats Up: Bruce Fraser
Energy Heats Up | Wyckoff Power Charting | StockCharts.com
The Federal debt Tsunami is coming to crush the market this year: David Skarica
Life in Prison Under Trudeau Anti-Free Speech Law: Bob Hoye
Life in Prison Under Trudeau Anti-Free Speech Law - HoweStreet
Cannabis Finally Getting a Buzz in the US: Mark Leibovit
Cannabis Finally Getting a Buzz in the US - HoweStreet
Crude Prices Have Suddenly Jumped: Josef Schachter
Crude Prices Have Suddenly Jumped - HoweStreet
Trading Desk Notes For March 23, 2024: Victor Adair
Trading Desk Notes For March 23, 2024 - HoweStreet
Technical Scoop from David Chapman and www.EnrichedInvesting.com
Technical Notes for Friday
FedEx $FDX an S&P 100 stock moved above $284.09 extending an intermediate uptrend. Responded to better than consensus quarterly results!
Nike $NKE a Dow Jones Industrial Average stock moved below $97.06 extending an intermediate downtrend. Responded to lower than consensus guidance!
Lululemon $LULU a NASDAQ 100 stock moved below $440.26 extending an intermediate downtrend. Responded to lower than consensus first quarter guidance!
Cognizant $CTSH a NASDAQ 100 stock moved below $72.41 setting an intermediate downtrend
Verisign $VRSN a NASDAQ 100 stock moved below $188.44 extending an intermediate downtrend.
Dollarama $DOL.TO a TSX 60 stock moved below Cdn$101.76 completing a double top pattern.
S&P 500 Momentum Barometers
The intermediate term Barometer dropped 4.00 on Friday, but gained 6.20 last week to 76.80. It remains Overbought.
The long term Barometer dropped 1.40 on Friday, but gained 2.80 last week to 80.80. It remains Overbought.
TSX Momentum Barometers
The intermediate term Barometer dropped 4.91 on Friday, but gained 5.63 last week to 68.30. It remains Overbought.
The long term Barometer dropped 0.89 on Friday, but gained 2.98 last week to 70.09. 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
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