Tech Talk for Tuesday May 8th 2018

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Pre-opening Comments for Tuesday May 8th

U.S. equity index futures were lower this morning. S&P 500 futures were down 7 points in pre-opening trade.

First quarter reports continue to pour in. Reporting companies since yesterday’s close included AMC Entertainment, Crocs, Dean Foods, Discovery, Dish, George Weston, Hertz, Jacobs Engineering, Mosaic, Nutrien, SeaWorld, Valeant, WestJet and Zillow.

The Canadian Dollar was virtually unchanged at U.S. 77.18 cents following release of Canada’s April Housing Start report at 8:15 AM EDT. Consensus was a slip to 210,000 units from 225,000 units in March. Actual was 214,400 units.

NVidia added $0.87 to $249.55 after Susquenhanna raised its target price to $230 from $200.

Valeant gained $1.59 to $19.75 after reporting higher than consensus first quarter results. The company also offered positive guidance and announced plans to change its name to Bausch Health. New symbol will be BHC.

Citigroup gained $1.15 to $68.50 on news that an activist investor has acquired a $1.2 billion position in the stock.

EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/05/07/stock-market-outlook-for-may-8-2018/

 

Observation

The TSX Composite Index moved above 15,791.15 to reach a three month high.

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StockTwits released yesterday @EquityClock

Bombardier $BBD.B.CA, a TSX 60 stock moved above $4.18 extending an intermediate uptrend.

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Technical action by S&P 500 stocks to 10:00: Mixed. Breakouts: $COP $I
R $NVDA. Breakdowns: $XRAY $CTSH.

Editor’s Note: After 10:00 intermediate breakouts included ILMN, SYY, CSCO, INFO and RHT. Breakdowns included GPS, IFF and CELG.

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Energy stocks and ETFs on both sides of the border lead equity markets on the upside: $OIH $XOP $COP $XLE $XEG.CA

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“Gassy” stocks and ETFs joined strength in the energy sector: $ZJN.CA $FCG

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Medical Devices iShare $IHI moved above $194.25 to an all-time high extending an intermediate uptrend.

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Canadian National Railway $CNR.CA $CNI, a TSX 60 stock moved above $101.10 setting intermediate uptrend.

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Intertape Polymer $ITP.CA moved below $19.20 extending an intermediate downtrend.

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Cisco $CSCO, a Dow Jones Industrial stock moved above $45.79 to a 17 year high extending an intermediate uptrend.

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Ivanhoe Mines $IVN.CA moved above $2.91 completing a double bottom pattern.

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Trader’s Corner

Daily Seasonal/Technical Equity Trends for May 7th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Daily Seasonal/Technical Commodities Trends for May 7th 2018

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Green: Increase from previous day

Red: Decrease from previous day

* Excludes adjustment from rollover of futures contracts

 

Daily Seasonal/Technical Sector Trends for May 7th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

S&P 500 Momentum Barometer

The Barometer added 0.40 to 47.60 yesterday. It remains intermediate neutral.

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TSX Momentum Barometer

The Barometer added another 3.28 to 70.90 yesterday. It remains intermediate overbought, but continues to trend up.

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Disclaimer: Seasonality 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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19 Responses to “Tech Talk for Tuesday May 8th 2018”

  1. bruce Says:

    Sherri
    tnx for the Euro and u.s.$ update last night……

  2. dutchcanuck Says:

    Pengrowth Energy (PGF.TO) Seymour Schulich bought 4,000,000 @ $1.12.

  3. rick Says:

    Bought today 200 shares MA ( at 189 )and 300 shares V ( at 129 ) for a long-long term hold .

    Why ? everybody use Mastercad or Visa or both .

    Almost 10 times growth in 10 years :http://www.tickertech.com/cgi/returns.mpl?symbol=V&smonth=01&sday=01&syear=1995&emonth=05&eday=08&eyear=2018&compareto=other&other=MA

    So in my account I have NDX futures , AAPL , MA ,V and 160 shares VXX on the short side .

    All = long time holds .

  4. rick Says:

    And I had to put down only 30 % of the total value of these shares .

  5. dutchcanuck Says:

    Neil/AB
    Nice recovery with COV. Hope you persevered with it.
    Must have been some good news altho I can’t track it down.

  6. Bernie Says:

    Here’s a low risk one, I think. Has a 5% yield but the history is only 2 years. Comments?
    http://stockcharts.com/h-sc/ui?s=MFT.TO&p=D&yr=2&mn=0&dy=0&id=p77125889278

  7. Kal Says:

    Rick,
    Why did u only have to put up 30% for ur MA & V purchase? Margin ?

  8. Larry/ON Says:

    Bernie – If you are going to hold fixed income it’s floating rate that makes sense in a rising interest rate environment. MFT makes sense in the current environment.

  9. Larry/ON Says:

    MFT – Just to add. The MER at 0.73% is a little high for a fixed income product. I would check to see if there is something similar offered by a company like Vanguard.

  10. rick Says:

    Kal,

    Yes , margin . But keep in mind that I do not pay interest because I am using the cash that is part of the investment in NDX futures contracts.
    This is my non- regis .investing account .
    Inside RRSP and TFSA I have TQQQ because I cannot invest there in NDX futures contracts .
    But I plan to change TQQQ with QQQ . TQQQ is very dangerous in a bear market .

  11. Sandra Says:

    Bernie: MFT.TO . very little volume . Do u recommend it for TFSA?

    Larry Berman recommended it-
    Floating rate notes give you an income payment adjusted to the change in short term interest rates. They go up in a rising rate environment, but there are not a lot of capital gains in this. He likes these notes in this environment, but more so in the US.

  12. Bernie Says:

    Sandra,

    Re: Mackenzie Floating Rate Income ETF (MFT.TO)
    I plan on adding some of this one and maybe BMO Floating Rate High Yield ETF (ZFH.TO) to my RRIF but not sure whether MFT is suited for a TFSA. I see almost all of MFT’s holdings are short term B to BBB rated U.S. bonds but the ETF is Canadian listed. ZFH’s holdings are lower risk Canadian treasury bills. You’d have no issues holding this one in your TFSA. The BMO ETF MER is 0.45 and yield is currently 4.6%. Ishares also carries a floating rate ETF, XFR.TO, but I don’t care for its low yield and poor performance.

  13. Sandra Says:

    For those following EIF:
    https://www.newswire.ca/news-releases/exchange-income-corporation-continues-strong-financial-performance-in-first-quarter-of-2018-682104381.html

    Good results, no mention of increasing dividend.

    Started a position at end of the day.

  14. Sandra Says:

    Bernie:
    Re #12:
    MFT.TO – I was thinking of buying in TFSA as the income would be tax free and I see it has been steadily going up, so there is potential for tax free gains as well. RRIF and RRSP are also a good idea.
    https://www.mackenzieinvestments.com/en/products/etfs/mackenzie-floating-rate-income-etf-mft
    I notice it says income and not dividend so no dividend tax credit.

  15. Sandra Says:

    Ron/BC,
    Here is chart of ECA.TO
    Very overbought and has made its way to the resistance point you mentioned.
    Weekly and monthly look good but it has to pass the resistance around $18.
    What do you see happening next?
    Thanks
    Weekly – http://schrts.co/5uDS2F
    Monthly – http://schrts.co/nsaUfD

    NTR; what happened with the condo?

  16. Ron/BC Says:

    Sandra
    ECA.to is right into resistance of $18 and getting overbought. Equity Clock shows the seasonal trend ends May 21st. I wouldn’t be complacent when holding it at resistance and nearing the end of its seasonal trend. Price would need to clear AND hold above $18 to suggest anything much on the upside.
    As far as the condo goes there were 9 offers and the top offer was about $40K above the asking price. It was just too pretty. Pristine places with a view do still go for top dollar. Perhaps I’ll come across one that needs a complete renovation. Those don’t show well so go much cheaper. Doesn’t cost a lot to renovate a condo relative to a house. But there is still strength in the condo market here with attractive units. Meanwhile I’ll just enjoy life and keep an eye out for one that suits me. I get all the listings emailed to me as soon as they hit the market so wont miss anything.

    http://stockcharts.com/h-sc/ui?s=ECA.TO&p=D&yr=2&mn=6&dy=0&id=p48430870213&a=579408566

    https://charts.equityclock.com/encana-corporation-tseeca-seasonal-chart

  17. Bernie Says:

    Sandra,

    Re: #13 EIF.TO
    The dividend was increased in April.

  18. Bernie Says:

    Sandra,

    Re: MFT.TO
    The interest distribution may or may not be tax free in a TFSA. The reason I’m not sure is because the holdings are predominantly U.S. bonds. There are withholding taxes on American dividends and interest income if its paid in a Canadian non-registered or TFSA account. The grey area here is that MFT.TO is a Canadian based ETF managed by MacKenzie investments. I can’t say for sure but I’d say there is a chance the withholding tax was paid by MacKenzie out of the high MER of 0.75%. You could take a chance and buy the ETF to see if the withholding is deducted or maybe contact MacKenzie Investments and ask them before buying.

  19. JP/BC Says:

    Bernie: I assume that becasue it is denominated in Canadian dollars they look after the tax owed to the US. Much like any ETF or Mutual fund that owns foreign stocks. Why would it be different?

    I was going to ask…the returns in the past year for MFT and ZFH have been rather modest. I assume a rising interest rate environment is bad for them as they are bond funds. Given the risk to capital, why do you think they are better than a GIC in your TFSA since there is no tax advantage?

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