Pre-opening Comment for Monday April 24th
U.S. equity index futures were lower this morning. S&P 500 futures were down points at 8:30 AM EDT.
Coca Cola added $0.84 to $64.89 after reporting higher than consensus first quarter revenues and earnings.
First Solar dropped $5.19 to $211.70 after Citigroup downgraded the stock from Neutral to Sell.
Chesapeake Energy added $0.15 to $81.00 after Truist initiated coverage with a Buy rating and a target price of $100.
PPG Industries gained $3.02 to $144.99 after JP Morgan upgraded the stock from Neutral to Overweight.
EquityClock’s Daily Comment
Headline reads “Investors continue to shy away from core-cyclicals and are favoring defense”.
http://www.equityclock.com/2023/04/22/stock-market-outlook-for-april-24-2023/
The Bottom Line
Focus this week is on quarterly reports: Four of the biggest market cap companies in the U.S. are scheduled: Microsoft and Alphabet on Tuesday, Meta Platforms on Wednesday and Amazon on Thursday. In addition, six Dow Jones Industrial Average companies are scheduled to report. Most quarterly reports released to date have nicely exceeded consensus. Responses for the most part have been positive (with notable exceptions such as Netflix and Tesla)
Economic news this week focuses on the March Core PCE Price Index released on Friday at 8:30 AM EDT. The report is watched closely by FOMC members when determining the Fed Fund Rate and is the last important economic report released prior to the next FOMC announcement on May 3rd. Consensus currently calls for another 0.25% increase in the Fed Fund Rate on May 3rd to 5.00%-5.25%.
Consensus for Earnings and Revenues for S&P 500 Companies
Source: www.Factset.com
Better than expected first quarter reports reported last week prompted analysts to increase slightly their first quarter earnings and revenue estimates: Eighteen percent of S&P 500 companies have reported to date: 78% reported higher than consensus earnings per share and 63% reported higher than consensus revenues. Consensus calls for a year-over-year drop in first quarter earnings of 6.2% (up from a drop of 6.5% last week) and an increase in first quarter revenues of 2.1% (up from a gain of 2.0% last week).
Estimates for the remainder of the year were reduced again .Consensus for the second quarter calls for a drop of 5.0% in earnings (versus a drop of 4.6% last week) and a drop of 0.1% in revenues (unchanged from last week). Consensus for third quarter earnings calls for a 1.5% increase in earnings (down from 1.9% last week) and a 1.4% increase in revenues (down from 1.5% last week). Consensus for the fourth quarter calls for an 8.5% increase in earnings (down from 8.8% last week) and a 3.7% increase in revenues (unchanged from last week). For all of 2023, consensus calls for an increase of 0.8% in earnings (down from 0.9% last week) and a 2.1% increase in revenues (unchanged from last week).
Economic News This Week
Source: www.Investing.com
March New Home Sales released at 10:00 AM EDT on Tuesday are expected to drop to 630,000 from 640,000 in February.
March Durable Goods Orders released at 8:30 AM EDT on Wednesday are expected to increase 0.8% versus a decline of 1.0% in February. Core March Durable Goods Orders are expected to drop 0.3% versus a decline of 0.1% in February.
March PCE Price Index ex food & energy released at 8:30 AM EDT on Friday is expected to increase 0.3% versus a gain of 0.3% in February. On a year-over-year basis, March core PCE Price Index is expected to increase 4.5% versus a gain of 4.6% in February.
March Personal Income released at 8:30 AM EDT on Friday is expected to increase 0.2% versus a gain of 0.3% in February. March Personal Spending is expected to decrease 0.1% versus a gain of 0.2% in February.
Canada’s February GDP released at 8:30 AM EDT on Friday is expected to increase 0.2% versus a gain of 0.5% in January.
April Chicago Purchasing Managers Index released at 10:00 AM EDT on Friday is expected to slip to 43.5 from 43.8 in March.
April Michigan Sentiment released at 10:00 AM ED on Friday is expected to remain unchanged from March at 63.5.
Selected Earnings News This Week
Source: www.Investing.com
Trader’s Corner
Equity Indices and Related ETFs
Daily Seasonal/Technical Equity Trends for April 21st 2023
Green: Increase from previous day
Red: Decrease from previous day
Commodities
Daily Seasonal/Technical Commodities Trends for April 21st 2023
Green: Increase from previous day
Red: Decrease from previous day
Sectors
Daily Seasonal/Technical Sector Trends for April 21st 2023
Green: Increase from previous day
Red: Decrease from previous day
Source for positive seasonal ratings: www.equityclock.com
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
Consumer Staples SPDRs $XLP moved above $101.88 extending an intermediate uptrend.
A major reason for the move by XLP was a breakout by Procter & Gamble following release of higher than consensus fiscal third quarter results. Procter & Gamble, a Dow Jones Industrial Average stock moved above $152.88 extending an intermediate uptrend.
Platinum ETN $PPLT moved above $101.88 extending an intermediate uptrend.
Thomson Reuters $TRI.TO a TSX 60 stock moved Cdn$178.99 to an all-time high extending an intermediate uptrend.
Telus $T.TO a TSX 60 stock moved above Cdn$28.63 and Cdn$28.69 extending an intermediate uptrend
Waste Connections $WCN.TO a TSX 60 stock moved above Cdn$196.25 to an all-time high extending an intermediate uptrend.
Links offered by valued providers
Michael Campbell’s Money Talks for April 22nd
Michael Campbell’s MoneyTalks – Complete Show (mikesmoneytalks.ca)
Check Out This Economic Indicator: Greg Schnell April 21, 2023.
Check Out This Economic Indicator | The Canadian Technician | StockCharts.com
Mark Leibovit on| AI, Gold, Bitcoin, Mortgages, Cash: April 20, 2023
AI, Gold, Bitcoin, Mortgages, Cash – HoweStreet
My Top 6 Long and Short Stock Picks | Mish Schneider | Your Daily Five (04.21.23)
https://www.youtube.com/watch?v=9ZzCBi0g-CM
Three Charts Suggest Pullback Imminent: David Keller April 22, 2023 at 12:34 AM
Three Charts Suggest Pullback Imminent | The Mindful Investor | StockCharts.com
Check Out This Economic Indicator Greg Schnell | April 21, 2023 at 01:17 PM
Check Out This Economic Indicator | The Canadian Technician | StockCharts.com
Bob Hoye: April 21, 2023 | A Very Interesting Year in Commodities
A Very Interesting Year in Commodities – HoweStreet
Victor Adair’s Trading Notes for April 22nd
Trading Desk Notes For April 22, 2023 – HoweStreet
Link offered by Mark Bunting and www.uncommonsenseinvestor.com
"A Heightened Sense of Risk." – Uncommon Sense Investor
Technical Scoop and www.EnrichedInvesting.com for April 24th
S&P 500 Momentum Barometers
The intermediate term Barometer was unchanged on Friday and added 2.60 last week to 56.80. It remains Neutral. Daily trend is up.
The long term Barometer slipped 0.60 on Friday and eased 0.80 last week to 59.40. It changed from Overbought to Neutral on a drop below 60.00.
TSX Momentum Barometers
The intermediate term Barometer added 3.02 on Friday and gained 60.78 last week to 65.52. It remained Overbought. Daily trend remains up.
The long term Barometer slipped 0.86 on Friday and dropped 2.58 last week to 64.66. It remains Overbought. Daily trend has turned down.
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
