- ExchangeNew York Stock Exchange
- CountryUnited States
S&P 500 consolidating despite negative signals We remain cautious as there continues to be several new or persisting negative signals which tell us that upside is likely to be muted from here -- barring improvements. At the same time we are not seeing widespread breakdowns and the major averages are still consolidating within a 1-month horizontal range. As long as this consolidation continues, a neutral outlook is appropriate. • Sector Relative Strength Rankings & Weighting Recommendations. Defensives (Staples, Utilities, Real Estate) notched new YTD RS highs yet again over the past week. Th...
Key Points: • A few Consumer Discretionary names continue to act well. The list is thinning of attractive names though. (ex. FOXF, UEIC, DECK, CHDN, WING, YUM, BOOT, RCI, POOL, DLTR, and AAN) • A number of Health Care Sector names are attractive. (ex. MASI, TFX, CNMD, STE, CRVL, LNTH, HAE, COO, WST, RGEN, ANIK, NEO, and TECH) • Attractive Technology and Services names include: MANH, CDNS, ANSS, AGYS, TTEC, CLGX, MMS, and KBR
Key Points: • Defensive areas of the market such as Utilities and REITs are breaking out. (ex. WELL, VTR, AIV, CPT, MAA, AVB, PSA, EQIX, ES, and XEL) • Consumer Staples continues to have a number of attractive names. (ex. GIS, CPB, FLO, KO, PM, CHD, CL, and PG) • The Healthcare Sector has a number of names with improving RS. (ex. MDT, IDXX, MDCO, JNJ, and MRK)
Key Points: • The decline in interest rates has investors seeking dividend related equities (ex. VZ, POST, VTS, WELL, ESS, O, NNN, EPR, FE, AEP, PNW, and NI) • A few Restaurants acted well despite the plunge in Friday's market (ex. DRI, MCD, YUM, and SBUX) • A few Staples Sector names are attractive. (ex. SJM, POST, SAFM, COKE, and KMB)
Cautious outlook intact; Downgrading Manufacturing Relatively solid earnings results have failed to support the market amid an ongoing host of concerns including, but not limited to, rising interest rates and a potential Fed policy mistake, and also a strong dollar and China-U.S. trade war fears. With the February low of ~2,532 only about 4% lower from current levels on the S&P 500 and seemingly no resolution in sight to the aforementioned concerns, we remain extremely cautious and expect consolidation, volatility, and lower prices to continue as the market searches for a bottom. • Sector Re...