Seasonal peak in oil inventories becoming confirmed as summer driving season gets underway. Real Time Economic Calendar provided by Investing.com. **NEW** As part of the ongoing process to offer new and up-to-date information regarding seasonal and technical investing, we are adding a section to the daily reports that details the stocks that are entering their period of seasonal strength, based on average historical start dates. Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends. Stocks Entering Period of Seasonal Strength Today: No stocks identified for today The Markets Stocks continued to rise on Wednesday as a larger than expected drawdown in oil inventories helped to “fuel” gains in the energy sector. The S&P 500 Energy Sector index jumped over 1.5%, moving above its 20-day moving average that had been curling lower and acted as resistance over the past couple of weeks. The energy benchmark recently found support around its 50-day moving average as investors continue to bet on a rebound in oil prices. The price of WTI Crude closed at a new 10 month high in Wednesday’s session, continuing to hover around overbought levels as the summer driving season starts to ramp up. As always for this time of week, the Energy Information Administration released its latest inventory report. For the week ending May 20th, oil inventories are indicated to have decreased by 4.2 million barrels, while gasoline inventories ticked higher 2.0 million barrels. Days of supply of oil is now lower by half of a day to 33.1, while gasoline saw a minor uptick by a tenth of a day to 25. As we’ve been speculating for many weeks now, it is becoming increasingly apparent that the seasonal peak in oil inventories is becoming confirmed as an ongoing decline in production and increased demand of refined product draws on the raw input. The rate of increase in oil inventories remains above average year-to-date, however, it is nowhere near the pace set in 2015 when the commodity saw a 25% increase in supply through the middle of May. Ending stocks of crude oil seasonally decline between now and mid-September, spanning the length of the summer driving season. Meanwhile, even though the seasonal change in US Gasoline stocks continues to run above average, the days of supply is inline with the average, suggesting a healthy balance between supply and demand. On the economic front, the April report on International Trade was released before Wednesday’s opening bell. The headline print indicated that exports increased by 1.8%, while imports advanced by 2.3%, resulting in a wider trade deficit than the month prior. Stripping out seasonal adjustments, exports declined by 5.4%, better than the –6.9% average for the month of April, and imports were lower by 2.4%, below the average change for the fourth month of the year of –2.0%. Both exports and imports are lagging the seasonal average change, year-to-date. The lag in exports is being picked up across each of the sub-components as the impact of a stronger US Dollar remains apparent in the results; the last time exports showed an above average seasonal pace was in 2011 when the US Dollar, as gauged by the US Dollar Index, was hovering around multi-decade lows, around 20% lower than what it is today. The influence of potential rate hikes on the US currency is something that the Fed will have to strategically navigate in order to not destabilize areas of the economy, such as trade. Export of Goods Sub-Components: Sentiment on Wednesday, as gauged by the put-call ratio, ended slightly bullish at 0.97. Seasonal charts of companies reporting earnings today: Seasonal charts of companies reporting earnings on May 26, 2016 VIEW SLIDE SHOW DOWNLOAD ALL S&P 500 Index TSE Composite