Pre-opening Comments for Friday March 22nd
U.S. equity index futures are higher this morning. S&P 500 futures are up 3 points in pre-opening trade.
Nike added $4.24 to $57.84 after reporting higher than consensus fiscal third quarter earnings.
Tiffany improved $2.74 to $70.65 after reporting higher than consensus fiscal fourth quarter earnings.
Micron added $0.75 to $9.82 after reporting higher than consensus fiscal second quarter sales.
Blackberry added $0.17 to $16.33 .Today the company launches its Z10 model in the U.S.
Lululemon fell $0.39 to $64.31 after CLSA downgraded the stock from Underperform to Sell.
Kohl’s (KSS $45.56) is expected to open lower after Deutsche Bank downgraded the stock from Hold to Sell.
Family Dollar Stores added $0.64 to $60.49 after Deutsche Bank upgraded the stock from Hold to Buy.
Gold equity ETFs on both sides of the border are breaking above short term trading ranges and are starting to show positive performance relative to gold.
First Quarter Earnings Expectations for the TSX 60 Companies
Consensus estimate for first quarter earnings shows a mixed picture relative to the same period last year. Average (median) for Canada’s top 60 companies shows no change on a year-over-year basis. Twenty five companies are expected to report lower earnings, four companies are expected to report no change and thirty companies are expected to report gains. Companies expected to report the highest percent gains included Agrium, Canadian Pacific, Gildan and George Weston.
Consensus estimates courtesy of Zacks Investment Research
Updates on Sector Seasonal Trades
Seasonal trades optimally have a technical score of 3 based on (1) uptrend, (2) trading above their 20 day moving average and (3) outperforming the market (S&P 500 for U.S. holdings, TSX for Canadian holdings). Scores moving lower than 3 are warnings signs. A score of 0-0.5 is a sell signal. The following seasonal trades have a technical score of 1.0 or higher and are in their period of seasonal strength. Their retention is recommended.
Technical score for Industrial SPDRs remains at 2.5. Seasonal influences are positive until early May.
Technical score for Consumer Discretionary SPDRs remains at 3.0. Seasonal influences are positive until mid-April.
Technical score for Retail SPDRs remains at 3.0. Seasonal influences are positive until mid-April.
Technical score for Palladium remains at 2.5. Seasonal influences are positive until the end of April.
Technical score for the U.S. Oil and Gas Exploration & Development SPDR remains at 3.0. Seasonal influences are positive until mid-April.
Technical score for Energy SPDRs slipped to 2.0 from 2.5 when strength relative to the S&P 500 Index changed from neutral to negative.
Technical score for Materials SPDRs changed from 3.0 to 2.5 when strength relative to the S&P 500 Index changed from positive to neutral. Seasonal influences are positive until early May.
Technical score for Gasoline fell from 1.0 to 0.0 when units fell below support at $60.66. This is a failed seasonal trade. Better opportunities exist elsewhere.
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Following is an example:
NASDAQ Composite Seasonal Chart
Disclaimer: Comments and opinions offered in this report at www.timingthemarket.ca 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.
Don and Jon Vialoux are research analysts for Horizons Investment Management Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons Investment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons Investment Management Inc
Horizons Seasonal Rotation ETF HAC March 21st 2013