View from Toronto: S&P, TSX Both Could Bounce Back

08/22/2017 2:51 am EST

Focus: STRATEGIES

Ziad Jasani

Managing Director and Partner, Independent Investor Institute

U.S. markets will be looking for a dovish presentation from central bankers at Jackson Hole, suggesting the S&P 500 can end the week above its 50-Day Average. In Canada, TSX is tied to Oil which is now in a mini-bounce back towards $49, says Ziad Jasani.


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US equity market outlook and summary  

View slide version here

Implications (US): S&P 500 is in the initial stages of confirming another mini-bounce by regaining support of 2,440-35, (August 18) with better odds to hold above to start the week and point to the 50-Day Average (2,450). With industrial input commodities rising and an expectation for yields to rise we are likely to see leadership from cyclical sectors vs. defensives. As we approach August 25 Jackson Hole Symposium,  markets will be looking for a dovish presentation from central bankers suggesting the S&P 500 can end the week above its 50-Day Average.

Trade-able short-term front half of the week ↑ (US):
SPDR S&P Pharmaceuticals ETF (XPH)

Energy Select Sector SPDR ETF (XLE)
Technology Select Sector SPDR Fund (XLK)  
SPDR S&P Metals & Mining (XME)
Consumer Discretionary Select Sector SPDR Fund (XLY)

iShares US Technology ETF (IYW)
Financial Select Sector SPDR Fund (XLF)
Energy Select Sector SPDR Fund (XLE)
Inverse Gold/Gold Miners

Canadian market outlook and summary

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Implications (Canada): TSX is tied to Oil which is now in a mini-bounce back towards $49, which implies the TSX holds above support of 15,025-14,950 with better odds to point up towards its 50-Day Average  (~15,200).
Trade-able short-term front half of the week ↑ (Canada):
iShares S&P/TSX Capped Composite Index (XIC-T)
iShares S&P/TSX 60 Index ETF (XIU-T)
iShares S&P/TSX Capped Financials Index ETF (XFN-T)

iShares S&P/TSX Capped Energy Index ETF (XEG-T)
BMO S&P/TSX Equal Weight Banks Index ETF (ZEB-T)

Weekly market strategy session (Video) – August 21-25

Recorded:  August 21.

video

View the Independent Investor Institute trading ideas and strategies video here

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