Big Earnings This Week and the Market Outlook
Jason Lubin June 22, 2020 4:07 PM
Can the S&P hold up?
On Tuesday, IHS Markit (INFO) is awaited to post 2Q EPS of $0.66 vs. $0.71 the prior year on revenue of $1.1B, in line with last year. The Co provides global data and analytics, and on June 11th, Altium, a provider of PC-based design software for engineers, announced a partnership with the Co in order to give its users actionable lifecycle status updates during the design process to phase out delays due to components becoming obsolete. Technically speaking, the RSI is above its neutrality area at 50. The MACD is positive and below its signal line. The stock could retrace in the short term. Moreover, the stock is trading above both its 20 and 50 day MA (respectively at $70.97 and $68.04). We are looking at the final target of $80.30 with a stop-loss set at $69.40.
On Thursday, Nike (NKE) is anticipated to release 4Q EPS of $0.12 vs. $0.62 the prior year on revenue of $7.6B compared to $10.2B last year. The Co designs and manufactures sportswear, and on June 11th, Chief Executive Officer John Donahoe stated that the Co will take steps to better support racial equality, including but not limited to adding the June 19 commemoration of the end of slavery to the company's list of paid holidays, according to Bloomberg. From a chartist's point of view, the RSI is above its neutrality area at 50. The MACD is positive and below its signal line. The stock could retrace in the short term. Moreover, the stock is below its 20 day MA ($97.93) but above its 50 day MA ($91.22). We are looking at the final target of $110.90 with a stop-loss set at $92.20.
Additionally on Thursday, Accenture (ACN) is expected to announce 3Q EPS of $1.85 vs. $1.93 the prior year on revenue of $10.9B compared to $11.1B in the year before. The Co is a leading global information technology services provider and on June 15th, Accenture Federal Services, a subsidiary of the Co was awarded a 341 million dollar contract to assist the U.S. Department of Commerce in updating its business systems and data platforms. From a technical point of view, the RSI is above 50. The MACD is positive and below its signal line. The stock could retrace in the short term. Moreover, the stock is trading under its 20 day MA ($203.11) but above its 50 day MA ($189.61). We are looking at the final target of $228.70 with a stop-loss set at $193.40.
Finally on Thursday, Darden Restaurants (DRI) is likely to unveil 4Q LPS of $1.64 vs. an EPS of $1.76 the prior year on revenue of $1.2B compared to $2.2B last year. The Co owns and operates a variety of branded restaurants, and its current analyst consensus rating is 20 buys, 10 holds and 0 sells, according to Bloomberg. Looking at a daily chart, the RSI is below 50. The MACD is positive and below its signal line. The MACD must penetrate its zero line to expect further downside. Moreover, the share stands below its 20 and 50 day MA (respectively at $78.59 and $72.86). We are looking at the final target of $58.40 with a stop-loss set at $81.90.
Looking at the S&P 500 CFD, the index appears to be in a consolidation range after breaking out of a short-term down trend on Monday, last week. The index is currently finding rough support on its 20-period moving average, which is below its 200-period moving average, a bearish signal. However price is advancing and the bias remains bullish as long as the S&P can stay above its low of the week at 3038. Price is expected to chop around before retesting 3116 and making its way back to 3156. If price cannot hold above 3038 support, we could see the index fall back to 2998.
Source: GAIN Capital, TradingView
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.