Stock Market Outlook for Fri Oct 18 2024 – Weakness Continuing

Prior Trading Day Summary:

Thursday saw earnings from Taiwan Semiconductor Stock (TSM) push smiconductor stocks higher. Other stocks also followed but as the day wore on, sellers began to take profits and by the close the S&P was down $1.00 or basically unchanged on the day.

The NASDAQ closed up just 6 points to end the day at 18,373. It was disappointing to see Thursday’s morning rally fizzle out by the end of the day.

Volumes were good with the SPX trading 3.5 billion shares and the NASDAQ trading 5.8 billion shares.

Let’s review the technical indicators from Thu Oct 17 2024to see what they expect for Fri Oct 18 2024,

Stock Market Outlook: SPX Closing Chart For Thu Oct 17 2024

The index started the day higher but by the close it was flat. The index closed at the Upper Bollinger Band and above the 21 day moving average.

The closing candlestick is bearish.

The 21 day moving average is higher at 5757. This is bullish.

The 50 day moving average is higher at 5631. This is bullish.

The 100 day moving average is rising and closed at 5530 which is bullish.

The 200 day moving average is in an uptrend and closed at 5296 which is bullish.

The Lower Bollinger Band is above the 50 day moving average and climbing. The Upper Bollinger Band is moving higher. The latest Bollinger Bands Squeeze is sending stocks higher.

The S&P chart is bullish for Friday but the closing candlestick is signaling a lower day should be expected.

SPX Stock Market Outlook review of Thu Oct 17 2024

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Oct 18 2024 

On Thursday the Weekly Initial Unemployment Insurance Claims were lower than estimated, coming in at 241,000 versus 260,000. Retail sales were slightly higher than estimated at 0.4% and the manufacturing index came in at 10.3 versus the 3.0 estimated and 1.7 prior. Analysts indicated that these economic reports supported the argument for the Fed continuing to cut interest rates but at a quarter point in the upcoming meetings.

While the day started out with a jump and another new intraday high for the SPX of 5878, the close saw stocks give back the day’s rally. This is bearish and the technical indicators are continuing to signal that weakness is continuing to grow.

For Friday Netflix stock should move higher on the back of better than estimated quarterly earnings but the chance of further weakness is high and a lower close would not be a surprise.

Potential Economic and Political Market Moving Events

Monday:

No reports

Tuesday:

8:30 Empre State manufacturing survey came in worse than expected at -11.9, well below estimated of 3.0 and the prior reading of 11.5

Wednesday:

8:30 Import price index was lower than estimated at -0.4%

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims were lower than expected at 241,000

8:30 Retail sales rose more than expected by 0.4%

9:15 Philadelphia Fed manufacturing index jumped much higher than estimated to 10.3

9:15 Industrial Production is fell more than estimated to -0.3%

9:15 Capacity Utilization slipped to 77.5%

10:00 Business inventories came in as expected at 0.3%

10:00 Home builder confidence index was slightly higher than estimated at 43

Friday:

8:30 Housing starts are estimated to slip to 1.35 million from 1.36 million

8:30 Building permits are estimated to slip to 1.45 million from 1.48 million.