To The Moon

We have quite several events happening on 21 Feb 2023, I would like to look at the US S&P Services PMI Flash and US S&P Manufacturing PMI Flash.

US S&P Services PMI Flash

Because the services sector dominates a large part of total GDP, the services PMI is an important indicator of the overall economic condition in US.

A result above 50 signals is bullish for the USD, whereas a result below 50 is seen as bearish.

There is a forecast of increase from 46.8 to 47.3, but even that it will still in contraction territory.

Last month downturn is mainly due to a slump in financial services activity, linked in turn to higher borrowing costs, with consumer-facing service providers also reporting especially tough business conditions amid the ongoing squeeze in spending due to the rising cost of living.

Hope this month, there is a improvement in the business activities and will lead the services PMI to above 50 in coming months.

US S&P Manufacturing PMI Flash

The US S&P Manufacturing PMI was 46.9 in January of 2023. This has shown three consecutive months showing falling factory activity.

The downturn was driven by a sharp contraction in new orders, a further drop in output and ongoing efforts to reduce inventories. Weak demand conditions stemmed from subdued sales across both domestic and export markets.

A forecast of 47.4 hopefully would help to show stronger demand in February, there should be better supply chain stability. Companies would start investing in new products.

What stocks would I look at?

Services

I would be monitoring service provider companies who are providing to a wide range of sectors. These service providers would benefit from an increase of the service PMI, if the actual value come close to the forecast.

This would one service provider stock I would look at $Docusign(DOCU)$ provides cloud based software in the United States. It offers services to mortgage, non-profit, government, real estate, insurance, technology and healthcare industries

Manufacturing

For the manufacturing I would be looking at those manufacturing companies releasing their earnings this week. There should be better demand.

I would expect an increase in business activities if the actual value came close to the forecast.

@TigerStars appreciate your support! Thanks in advance for your support!

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Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Technical Analysis, and there are many other indicators that need to be look at together. (e.g., Price Action, Volume, etc.).