Stock Market Investing Action Plan: What Part Of November Don’t You Understand?

As November reaches its final few sessions, the market is sitting on a happy comeback. What to expect for the stock market in December can be revealed in part this week, in key November papers and the consumer spending index. Corporate talk about the expected recession has cooled somewhat. The upcoming OPEC vote and the Russian oil embargo have the potential to shake up energy markets. China’s EV sales reports for November this year could indicate the country’s return to Covid lockdown concerns. And when the income season ends, Dollar General (DG), Salesforce.com (CRM) and Ulta Beauty ( ULTA ) are among the companies reporting.

Stocks to watch: Five stocks near buy points

The stock market is consolidating, with the S&P 500 moving toward its 200-day moving average. Investors should build their own checklist by placing stocks or flashing buy signals. Dexcom (DXCM), RBC bearings (RBC), Chubb (CB), EQT Corp. (EQT) and Regeneron Pharmaceuticals (REGN) are showing strong action. Dexcom is regrouping after strong gains, creating what can be seen as a long-term base for the team. Chubb and RBC Bearings are also located near the cup purchase points. EQT stock has already flashed an early entry. Regeneron is trading strongly near major highs and moving averages.

Economy: November wages

Next Friday’s November jobs report, if as weak as current estimates suggest, could be the beginning of the end for Fed tightening. According to FXStreet, economists expect employer payrolls to fall by 30,000, a sharp drop from the 261,000 gain in October, which was the weakest since December 2020 before vaccines became available. The employment report wraps up a big week of data. On Wednesday, we’ll get the second estimate of Q3 GDP at 8:30 AM, followed by Jobs and Labor at 10 AM. At 8:30 a.m. on Thursday, we’ll get an October update on the Fed’s favorable inflation report, the PCE price index and the latest week of jobless claims. At 10 a.m., the Institute for Supply Management’s manufacturing survey index could show a decline from the neutral level of 50.


US economy feels like it’s sinking: IBD/TIPP Poll


Stock market outlook: A pair of April hurdles

As the stock market prepares for December, the major indexes are still down for the year: The Dow Industrial is down nearly 6%, the S&P 500 is down more than 15% and the Nasdaq is down 28%. But after hitting its October lows, the Dow is up more than 19%. The S&P 500 is up more than 15% over the same period. The Nasdaq composite lagged, not up 12%. The advance leaves the Dow roughly even with 34,281 in mid-August. A break above that point would put the index at its highest point since April. The S&P traded less than 1% below its 200-day moving average on Friday, a line it has reached but not closed above since early April. The Nasdaq retook its 50-day line in early November and sits 3% above that support level.

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China EV sales

Chinese EV startups Nio (NIO), Xpeng (XPEV) and Lee Auto ( LI ) will report November EV sales, likely on Thursday. China’s EV and battery giant BYD (BYDDF) should follow in a few days. Nio is being watched in particular, after its October shipments fell compared to September and missed its target for record monthly shipments. The once-hot startup was supposed to be in a “product supercycle” after launching several new electric models, but Covid-19 and operational issues are taking hold. Deutsche Bank analysts expect Nio shipments to increase from around 10,000 in October to 13,500 in November and 19,500 in December, saying the worst may be over. In October, BYD’s all-electric sales doubled to 100,000 for the first time, making up the difference with Tesla (TSLA).

Energy, stock markets for OPEC, EU embargo

Already very active oil and natural gas markets could see more price action ahead of the December 4 meeting of the Organization of the Petroleum Exporting Countries and its allies, including Russia. News reports say a 500,000 barrel per day production increase is on the table. However, several OPEC members, including Saudi officials, deny these reports. The European Union aims to start its embargo against Russian oil on December 5. EU leaders are trying to negotiate a cap on Russian oil sold outside the embargo zone, but Russia is already selling less than the proposed limit. plans to ignore EU price rules. This raises questions about the effectiveness of the embargo.

Dollar Stores: Dollar General, Five Below, Ollie’s Big Lots

Discount chains will report third-quarter results on Wednesday and Thursday ahead of the holiday season. It’s been a mixed bag for retail earnings as inflation-stressed consumers shift their spending habits. Dollar General revenue growth is expected to accelerate to 22% and revenue growth to 10.6%. This represents a fifth consecutive increase in sales. Ollie’s Shop ( OLLI ) is expected to post 17% EPS growth, its first earnings report in six quarters. It is expected that the loss for the discounter counterpart Large lots (BIG).

Recession talk is easing, but Q4 S&P 500 earnings are expected to be lower

CEOs of 179 S&P 500 companies mentioned the word “recession” in conference calls from Sept. 15 to Nov. 16, according to FactSet. (About 6% of S&P 500 companies have yet to report.) That’s down 26% from the record 242 companies that used the word during second-quarter calls from June 15 to September 14. – an average of 63 companies. The most frequently mentioned sectors were finance (34) and industry (32). The sectors with the highest percentage of companies citing a recession were real estate (67%), materials (57%) and finance (54%). The sectors with the biggest declines in the recession are financials (-20%) and information technology (-10%). Analysts cut EPS estimates to a total of 3.3% in October — more than double the five-year average of 1.4%. The index is now collectively reporting its first EPS decline, an estimated 2.1% decline, since a 5.7% decline in the third quarter of 2020.

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The stock market is mixed as the leading Dow Jones; Will Fed Chair Powell’s Talk Bring Stocks Down Again?



Stock market returns


Tuesday:

NetApp ( NTAP ) will report fiscal second quarter results on Tuesday. Analysts expect earnings per share of $1.33, up 44% on revenue of $1.67 billion, up 7% for the enterprise storage management systems provider.

CrowdStrike Holding ( CRWD ) will report third-quarter earnings after the market closes on Nov. 29. Analysts expect the cybersecurity company’s profit to rise 88% to 32 cents a share and revenue to rise 51% to $575 million.

Enterprise software developer Working day (WDAY) will report Q3 earnings late Nov. 29. Analysts estimate EPS of 84 cents, down 23% from a year earlier. Analysts forecast revenue growth of 19% to $1.585 billion.

Hewlett Packard Enterprise (HPE) will report its fiscal fourth quarter earnings late on Nov. 29. Analysts expected earnings per share of 57 cents, up 9% from a year earlier, and revenue rose 1% to $7.37 billion.

Wednesday:

Titan Machinery ( TITN ) will report third-quarter earnings before the stock market opens. The Street predicts earnings will rise 21% to $1.16 per share for the agricultural and construction equipment maker. Analysts expect revenue to rise 31% to $597 million in the third quarter.

Salesforce.com (CRM) will report Q3 earnings on November 30. Analysts expect the software-as-a-service leader to earn $1.22 per share, down 4% from a year earlier. Analysts expect a 14% increase in revenue to $7.83 billion.

Cloud computing software developer Snowflake ( SNOW ) will report Q3 earnings at the end of November 30th. Analysts expect flat earnings at 4 cents. Revenue is expected to rise 61% to $539.1 million.

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Synopsis ( SNPS ) plans to report its fiscal fourth quarter results later Wednesday. Analysts expect the chip design software maker to earn $1.85 per share, up 2% year over year and up 11% on sales of $1.28 billion.

Pure stock (PSTG) will report quarterly results later Wednesday. Analysts expect the company to report earnings per share of 25 cents, or 14%, on revenue of $672 million, or 19%, for the data storage and enterprise networking company.

Box (BOX) will report quarterly results late Wednesday. Analysts expected earnings of 30 cents per share, up 36% on revenue of $251 million. That’s up 12% for the provider of cloud-based business collaboration and content management services.

Thursday:

Kroger (KR) is early on Thursday. The supermarket giant should see 4% EPS gain to 81 cents on 7% revenue growth. KR shares are based around the long-term moving average with a buy point of 62.88.

A cyber security company Zscaler ( ZS ) will report fiscal 1st quarter earnings at the end of December 1st. Analysts expect EPS of 26 cents, up 86% from the prior year. Analysts expected revenue of $340.7 million, up 49%.

Medical software developer Veeva Systems ( VEEV ) will report fiscal third-quarter earnings on Dec. 1. Analysts expect EPS to rise 10% to $1.07. Analysts were expecting revenue of $546 million, up about 15%.

Ulta Beauty (ULTA) reports late Thursday. Analysts forecast 5% EPS growth to $4.11 on 10% revenue growth. ULTA shares are just above the 451.40 buy point from the bearish base and above the 50-day moving average after the October low.

Marvell Technology ( MRVL ) will release its fiscal third quarter results later Thursday. Wall Street is projecting Marvell earnings of 59 cents per share on sales of $1.56 billion. This results in a 37% year-over-year increase in revenue and 28% in sales for the chipmaker.

Splunk ( SPLK ) will report fiscal third-quarter results later Thursday. Analysts expect earnings per share of 25 cents, compared with a loss of 37 cents. The consensus is for revenue of $847 million, up 27%, for the data analytics provider.

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