The Bottom Line
Will U.S. and Canadian indices follow their traditional pattern of moving higher this year from November until the first week in January (i.e. the so called Christmas rally season)?
Performance this year in the U.S. has been dominated by the top 10 U.S. stocks in the S&P 500 Index with their heavy weight in the Technology sector. The qualification this year is that positive performance by the top ten S&P 500 stocks (Over 55% of the weight in the S&P 500 Index) must continue this November/early January for history to repeat.
What about performance of the remaining 490 stocks in the S&P 500 Index? History shows that the equal weight S&P 500 Index ETF (RSP) also has a period of seasonal strength from November to the first week in January. However, its performance depends upon advances by the remaining 490 stocks.
Recent performance by the equal weight S&P 500 Index and related ETF (RSP) has been less than spectacular: Indeed, RSP broke below its 20 and 50 day moving averages late last week. The ETF closed on Friday below closing levels set in the third week in August.
Early technical weakness by Sector SPDRs other than Technology SPDRs (XLK) raises doubts about possibility of a significant yearend rally this year. Indeed, several select sector SPDRs recorded a drop in technical score last week including Materials, Industrials, Financials, Health Care and Real Estate.
Consensus for Earnings and Revenues for S&P 500 companies
Source: www.factset.com
Analyst earnings and revenue estimates increased significantly again last week thanks to “blow out” earnings released by Microsoft, Alphabet, Apple and Amazon: 64% of S&P 500 companies have reported to date: 83% exceeded consensus earnings estimates and 79% exceeded consensus revenue estimates.
- Consensus for third quarter 2025 earnings gains advanced to 10.7% from 9.2% from the previous week. Consensus for third quarter revenue growth increased to 7.9% from 7.0%.
- Consensus for fourth quarter 2025 earnings increased to 7.6% from7.4%. Revenue growth increased to 6.6% from 6.5%. For all of 2025, consensus for earnings growth increased to 11.2% from 11.0%. Consensus for revenue gains increased to 6.6% from 6.3%.
- Consensus for first quarter 2026 earnings growth slipped to 11.8% from 11.9%. Consensus for revenue gains increased to 7.4% from 7.2%.
- Consensus for second quarter 2026 earnings growth remained at 12.8%. Consensus for revenue growth remained at 6.4%.
- For all of 2026, consensus for earnings growth increased to 14.0% from 13.9%. Consensus for revenue growth increased to 6.8% from 6.6%.
Economic News This Week
U.S. economic data provided by the U.S. Federal Government is unavailable until the current shutdown is concluded.
Canada’s September Trade Report is released at 8:30 AM EDT on Tuesday
Selected Earnings News This Week
Another 136 S&P 500 companies (including two Dow Jones Industrial companies: Pfizer and McDonald’s) are scheduled to report this week. Another 14 TSX 60 companies are scheduled to report. TSX 60 companies are indicated as bold.
Trader’s Corner
Equity Indices and Related ETFs
Daily Seasonal/Technical Equity Trends for October 31st 2025
Green: Increase from previous day
Red: Decrease from previous day
Source for all positive seasonality ratings: www.EquityClock.com
Commodities
Daily Seasonal/Technical Commodities Trends for October 31st 2025
Green: Increase from previous day
Red: Decrease from previous day
Sectors
Daily Seasonal/Technical Sector Trends for October 31st 2025
Green: Increase from previous day
Red: Decrease from previous day
Changes last week
Technical Notes for Friday
Materials SPDRs (XLB) moved below $85.61 completing a double top pattern.
Retail SPDRs (XRT) moved below $80.88 extending an intermediate downtrend.
Amazon (AMZN) moved above $238.85 and $242.52 to an all-time high extending an intermediate uptrend.
Ilumina (ILMN) a NASDAQ 100 stock moved above $111.00 resuming an intermediate uptrend.
McKesson (MKC) a NASDAQ 100 stock moved below $63.22 extending an intermediate downtrend.
DexCom (DXCM) a NASDAQ 100 stock moved below $63.19 and $57.52extending an intermediate downtrend.
Links offered by valued providers
Michael Campbell’s Money Talks for November 1st
Michael Campbell’s MoneyTalks – Complete Show (mikesmoneytalks.ca)
Stock Pullback Expected After Big Surge: Mark Leibovit
https://www.howestreet.com/2025/10/stock-pullback-expected-after-big-surge-mark-leibovit/
This Week in Markets: Ross Clark, Martin Armstrong
Falling Rates, Rising Profits, and a Relentless Tech Rally: Tom Bowley
Falling Rates, Rising Profits, and a Relentless Tech Rally – YouTube
Canada’s August GDP falls 0.3% month-over-month: BNN
Canada’s August GDP falls 0.3% month-over-month – YouTube
A "Blow-Off Top" Ahead? Goldman Sachs
A "Blow-Off Top" Ahead? – YouTube
How Much Could Stock Market Lose When Bubble Bursts? Bob Hoye
How Much Could Stock Market Lose When Bubble Bursts? – HoweStreet
Trading Desk Notes for November 1, 2025: Victor Adair
https://www.howestreet.com/2025/11/trading-desk-notes-for-november-1-2025/
S&P 500 Momentum Barometers
The intermediate term Barometer dropped 0.60 on Friday and 12.00 last week to 41.00. It remains Neutral.
The long term Barometer added 0.40 on Friday and dropped 8.80 last week to 56.00. It changed from Overbought to Neutral on a drop below 60.00.
TSX Momentum Barometers
The intermediate term Barometer added 5.63 on Friday and dropped 9.86 last week to 60.09. It remains Overbought.
The long term Barometer added 1.41 on Friday and dropped 3.76 last week to 80.28. It remains Overbought.
Disclaimer: Seasonality ratings and technical ratings offered in this report and at
www.equityclock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed
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Equity Clock Publications