Market Action Summary: 3/4/19


S&P 500 Overview: Battle for 2800

  • Outside day on S&P 500, biggest range (49 points) since January 4
  • MACD slowing, stochastic has been overbought.
  • Breadth still mostly positive, led by risk-on sectors like financials and technology.
  • New leadership potentially emerging.
  • Market could churn like April-June 2016, waiting for 50DMA to cross through 100DMA.

Health Care Haves and Have Nots

  • Haves: Biotechs amid takeovers
  • Haves: Medical devices
  • Haves: Potential hospital turnarounds
  • Have Nots: Pharmacy-benefits
    • ABC, MCK, CAH at risk?
  • Have Nots: Generic drug makers
  • Have Nots: Health insurers
  • Closely held Purdue Pharma may seek Ch. 11

Group in Focus: Sneakers & Footwear

  • Foot Locker (FL) filling May 2017 bearish gap after strong results.
  • Skechers USA (SKX) running since February 8 earnings.
  • China / Asia new growth market.
  • Nike (NKE) reports after the close on March 21.
  • Genesco (GCO), parent of Journeys and Lids, due on March 14.

Economy: Good or bad?

  • Positive: Dovish Fed
  • Positive: GDP still shows business investment
  • Positive: Signs of housing rebound like mortgage applications, pending home sales, NAHB survey
  • Negative: ISM manufacturing lowest reading of Trump presidency
  • Negative: Jobless claims trending higher
  • Negative: Rail traffic starting to contract

Don’s Watch List

  • (CRM): Software giant reports tonight.
  • Kohl’s (KSS): Retailer reports tomorrow morning.
  • Target (TGT): Retailer reports tomorrow morning.
  • Ross Stores (ROST): Retailer reports tomorrow night.
  • Crocs (CROX): Footwear maker reports Thursday morning.
  • Costco (COST): Warehouse retailer reports on Thursday morning.
  • Marriott (MAR): Hotel giant reports Thursday night.

Russell’s Watch List

  • Facebook (FB): Potential to escape tight range after strong earnings
  • Chips may struggle amid China uncertainty.
  • Community Heath (CYH): Short-squeeze potential
  • CVS, WBA, TEVA: Debt-laden downside risk.
  • Pinduoduo (PDD): New China tech testing new highs
  • Array Biopharma (ARRY): Oncology name to watching / wait for pullback

Don’t Miss

  • February 27: Good news sneaks out for energy sector
  • February 28: Consumer comebacks & new tech breakouts
  • February 28: Big tech stocks remained favorites among TradeStation clients last month.
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David Russell is Global Head of Market Strategy at TradeStation. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.