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Monday Market Outlook 02262024

Good morning, everyone, and welcome to Monday morning. It’s Stephen Whiteside here from In the pre-market this morning, things are fairly quiet. Stock index futures and commodities are slightly below fair value, but there’s certainly no sign of aggressive selling coming into Monday morning. Hey, I’ve been off a couple of days. I’ve been sick. That hasn’t changed much. But last week, you couldn’t have heard me speak. So the first time I’ve had a cold since before COVID. So hopefully this won’t continue for very long. We’ve got Bitcoin and Ethereum both hitting new highs last week with the overall stock market. The VIX on a weekly basis is still on a sell signal. That’s supportive for higher stock prices. On a daily basis, we’re back on a sell signal as of Friday’s close, and of course, that can be supportive for higher stock prices going forward. Now, the VIX did trade up through $15 as we were expecting, and we did get some gyrations in the market. Remember, we had a daily sell signal in the Dow, then we had a daily signal in the Nasdaq, and both of them flipped back during the week. And so we’re fully back on daily buy signals for all the major indices.

Looking at the S&P 500, it has broken through 5,000. It is still closing above it. It certainly dipped through it last week, so it’s not a huge area of support. It’s just we are trading above a psychological number. We’ll have to see how long we can stay above it, but we certainly closed above the previous week’s high. That had a lot to do with NVIDIA, which came out with earnings, and we got a sell signal going into earnings, and then the next morning, we woke up and saw that after the earnings announcement, traders traded the stock sharply higher, and so there was no reason to take that sell signal. So far in 2024, NVIDIA is up another 59% leading the S&P 500 higher for the year. Then we’ve got Metta up 36.37%, and then we’ve got Eli Lilly up 32.01 %. Tapestry up 33.89 %. Catalent up 30.8 % so far in 2024. Now, what hasn’t worked on the S&P 500? Well, I’m not going to go through too many of them, but MarketAxess is the big loser, followed by Arthur Daniels Midland. And then the only gold mining stock in the S&P 500 Newmont down over 24% year to date.

And that’s, of course, not a good sign for a Canadian investor who follows a lot of gold stocks. Now, looking at the TSX, the TSX is also making new highs right now. And as you can see, we still have a ways to go before we hit the all-time high, but we are certainly clearing the highs from 2023. 2023 was a very rough year for the TSX. We couldn’t get everybody lined up at the same time. Information technology did well throughout the year. Now, we’ve got financials back in sync with the rest of the market. We’ve got energy stocks moving higher. That can help the TSX. Then, unfortunately, gold stocks made a new low last week. Even though the price of gold was up on the week, gold stocks are not in favor at the moment. Now, so far in 2024, Celestica has been the big winner up over 40%, looking at Aritzia up over 32%, and then we’ve got Trisura, up over 27%, and then we’ve got Tricon, up nearly 25%. That stock looks like it’s going to be taken out. Then SSR mining is the big loser on the TSX, down over 55%, followed by a NovaGold, down over 34% year to date.

Let’s finish off with a quick look at commodities. Crude oil is down on the week, still holding We have it in there. We did not close below the previous week’s low. Natural gas up 1% in change on the week. No change in trend there. Then looking at a couple of the inflation components, we’ve got corn making a new low. We’ve got soy beans down at the previous low from last year. Then we’re looking at wheat, and wheat’s holding the low that it hit a couple of months ago, so no change in trend there. Then looking at copper. Copper is back on a weekly buy signal as of Friday’s close. Gold was It’s up on the week, up over $25, closing just above the previous week’s high, which could turn out to be bullish for the price of gold. Then we’ve got the price of silver, unfortunately, going the opposite direction. So we’re still on a weekly sell signal for silver. They And then, Coco hit a new high. Look for upward pressure on the price of chocolate bars or the quality of those chocolate bars is going to continue to deteriorate. Okay, folks, that is all for this morning’s presentation.

So far, it It looks like we’re going to have a fairly quiet open on Monday morning. Have a great day. Next time, you’ll hear my voice, hopefully on Tuesday morning. Good morning.

Stephen Whiteside
Monday, February 26, 2024


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