Sector Spotlight: Earnings Season Begins

Market Recap For July 15th, 2022

Thursday’s turnaround left a very clear bullish tone which implied higher prices might be coming on Friday, and Friday delivered.

Similar to our Friday forecast, higher prices should come this week. Of course, traders should be prepared for pullbacks along the way, especially if there is no meaningful continuation on Monday.

Yesterday’s Sector Performance

Every sector finished in the green, with Financials leading the way as they kick off earnings season.

The defensive Utilities and Staples brought up the rear.

Five-Day Sector Performance

Staples ended up winning the week, while also being the only one in the green.

Communication Services finished at the bottom.

ETF Trade Watch

Healthcare Select Sector SPDR (XLV)

Healthcare related stocks have been some of the top performers over the past few weeks, and the XLV looks like it may be moving higher once again. Healthcare stocks typically fare better than other sectors as even in times of recession, health is still a top priority of us all. The chart shows some relatively consistent consolidation between $124-134 with a few outlying months.

Financials Select Sector SPDR (XLF)

Financials have had it just as rough as most other sectors this year, but Friday may be a sign that the XLF is making a turn. As largest financial firms in the world report earnings, investors and traders will look to see how these set the tone for the rest of the season, and perhaps more importantly, their outlooks. If financials are able to beat we could see the recent bullishness continue.