EarningsBeats.com Digest for July 13, 2020
|
Trading Places Live!
Join Tom Bowley for a briefing on market activity on Mondays and Wednesdays from 9-9:30 am EST before the opening bell. Click here to listen live or visit our YouTube page later today to view the recorded session.
Dear Digest Subscriber,
Join us today for our Q2 Earnings Sneak Preview webinar at 4:30pm eastern. During this session, Tom Bowley, Chief Market Strategist and John Hopkins, President will discuss what will be covered during the Q2 Earnings Webinar on July 20th. This will include identifying some stocks that could gap up or down significantly when they report their numbers.
This event is open to YOU as a free newsletter subscriber. Room instructions will be emailed out later this afternoon - we hope to see you there!
Most Eyes Will Be On Banks This Week, But Mine Will Be Here
A number of large banks will be reporting earnings from Tuesday through Thursday of this week, and there's no doubt that Wall Street will be waiting to hear what impact COVID-19 has had on their business. I don't look for very good reports out of most banks as the outlook for that industry has to be cloudy looking forward and its relative strength vs. the S&P 500 has been awful. No one can predict the level of potential loan losses that banks could
face and it's likely to remain unclear for at least the next few months. However, the ability for the stock market to sustain its wild run higher since the March low could come down to how transportation stocks fare. On Friday morning, we'll hear from one of the better railroads over the past 52 weeks - Kansas City Southern (KSU):
KSU is in a nice channel, but is currently testing the lower channel support line. KSU also is showing a PPO that's residing very close to centerline support. Throw in the fact that railroads ($DJUSRR) as a whole are in a consolidating, but bullish, relative bull wedge, and it's apparent to me that the resolution of railroads will likely have much more of an impact on U.S. equities than the reaction to bank earnings reports. Remember, there's
a long-term positive correlation between the relative performance of transports, especially railroads, and the overall performance of the S&P 500. In other words, when railroads are strong, the S&P 500 has a tendency to behave quite bullishly as well.
Happy trading!
Tom Bowley
Chief Market Strategist
EarningsBeats.com
Better Timing. Better Trades.
|
|
|
