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Profit from These 5 Sturdy Stocks as Fear Grips Markets
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The use of the “Mother of All Bombs” on Afghanistan to wipe out Islamic terrorists has been quite a geopolitical concern for traders. This is understandable, especially at a time when ties between the U.S. and Russia are strained, thanks to the indiscriminate gassing of children in Syria. North Korea, on the other hand, is mulling over a potential nuclear attack to which U.S. Vice President Mike Pence said that the “era of strategic patience” is over with the communist regime.
Domestic worries also surface as collapse of President Trump-backed healthcare bill raised questions over the timing and scope of tax reforms and infrastructure spending plans. To top it, U.S. retail sales marked the worst two-month stretch in two years in March, adding to the pool of data that hint at soft first-quarter growth. Thus, it is imperative for investors to zero in on fundamentally sound stocks that offer decent returns and are resistant toward market turbulence.
Fear Creeps Back Into Markets
Risk-averse traders continue to remain on the sidelines after a discouraging week for the equity market. The CBOE Volatility Index (VIX), Wall Street’s best gauge of fear in the market, closed above its 200-day moving average for the first time since the presidential election. VIX spiked more than 20% last week, while stocks fell to close at session lows.
All the major indices cemented a three-day losing streak and ended the holiday-shortened week in the red. The Dow Jones and the S&P 500 dropped around 1% last week, with both remaining below their 50-day moving average, a bearish sign for the near term.
U.S. Drops ‘Mother of All Bombs’
Concerns about the geopolitical landscape have put investors in a fix. In recent times, fear was largely driven by the deployment of a GBU-43/B Massive Ordnance Air Blast (MOAB) bomb, known as the “Mother of All Bombs”, by U.S. military forces, targeting an ISIS tunnel network and personnel in the Achin district of Nangarhar Province, Afghanistan.
MOAB is the largest non-nuclear bomb which is capable of breaking through 200-feet of reinforced concrete, according to the Global Research Centre for Research on Globalization. The dropping of such a nonnuclear weapon did little to boost traders’ optimism, with stocks losing considerable ground.
Geopolitical Jitters Persist
Trading has also been marked by worries over the calamity in Syria and heightened tensions between U.S. and North Korea. As diplomats struggle to solve issues pertaining to Syria, the relationship between the U.S. and Russia maybe “at an all-time low”, as per President Trump. Both the countries clashed over a range of issues including the future of Syrian President Bashar al-Assad. White House officials had alleged Russia of trying to cover up the ghastly Syrian chemical attack. The U.S. concluded that the Syrian military used banned sarin gas in the attack that had inflicted severe casualty on many civilians.
Tensions around North Korea, in the meanwhile, are heating up as the communist state warned of a nuclear attack on the U.S, which had sent a Navy strike group toward the Western Pacific. Trump has already said that U.S. will respond to Pyongyang itself if China, one of North Korea’s allies, doesn’t act.
Investors Fear ‘Partisan Conflict’
Even though geopolitical developments are dominating the headlines, domestic worries aren’t to be ignored. The IIF, a trade group representing the world’s largest banks, noted that the Trump administration is going back to the drawing room regarding implementation of U.S. tax reforms. This means that the ambitious deadline for a tax code overhaul plan is unlikely to be reached, a heavy blow for growth stocks. Meanwhile, Trump said that the healthcare bill debacle must be dealt with before moving on to his tax overhaul plans.
Concerns surrounding the conservative Republicans blocking any infrastructure-spending plans have also hurt the momentum of construction and engineering stocks. Both these stocks have retreated 10% from their late January peak as per IIF.
Growth on the Soft Side as Retail Sales Dip
Sales at U.S. retailers, in the meanwhile, marked the worst two month stretch in March, underlying the magnitude of the loss of economic growth in the first quarter. Retail sales cover the durables and non-durables portion of consumer spending. And consumer outlays account for more than two-third of the economy.
The Commerce Department said that retail sales dropped 0.2% last month amid softening demand for automobiles. The apparent slowdown is also partly blamed on the slower than usual issuance of tax refunds by the government. However, what made the decline even worse was a government update to sales figure for February showing a drop of 0.3% in contrast to the 0.1% increase reported at first.
5 Solid Stocks to Buy Now
Given the pessimism surrounding the state of the broader markets, investing in sturdy stocks seems practical. To pick such stocks, we have chosen five large caps, typically over $10 billion, as these tend to be less risky and more stable compared to their smaller counterparts due to their size and access to capital. These stocks also provide steady dividends, which eventually make them immune to market vagaries.
Such stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy) and a VGM score of ‘A’ or ‘B’. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Metlife Inc (MET - Free Report) is a provider of life insurance, annuities, employee benefits and asset management. The company has a Zacks Rank #2 and a VGM score of ‘B’. Metlife has a dividend yield of 3.13%.
The company has a price/earnings to growth ratio (PEG) of 0.89, compared with 1.49 for the industry. The company is likely to return 16.8% this year, better than the Insurance - Multi line industry’s estimated addition of 6.4%.
Nucor Corporation (NUE - Free Report) manufactures steel and steel products. The company has a Zacks Rank #2 and a VGM score of ‘B’. Nucor’s dividend yield stands at 2.65%.
The company has a price/earnings to growth ratio (PEG) of 1.12, compared with 2.08 for the industry. The company is likely to return 67.7% this year, way higher the Steel - Producers industry’s projected increase of 33.6%.
Texas Instruments Incorporated (TXN - Free Report) designs, makes and sells semiconductors to electronics designers and manufacturers. The company has a Zacks Rank #2 and a VGM score of ‘B’. Texas Instruments has a dividend yield of 2.57%.
Eli Lilly and Co (LLY - Free Report) is engaged in drug manufacturing business. The company has a Zacks Rank #2 and a VGM score of ‘B’. Eli Lilly has a dividend yield of 2.42%.
The company has a price/earnings to growth ratio (PEG) of 1.75, compared with 1.78 for the industry. The company is likely to return 16.6% this year, more than the Large Cap Pharmaceuticals industry’s estimated gain of 1.9%.
Best Buy Co Inc (BBY - Free Report) is a provider of technology products, services and solutions. The company has a Zacks Rank #1 and a VGM score of ‘A’. Best Buy has a dividend yield of 2.82%.
The company has a price/earnings to growth ratio (PEG) of 1.24, compared with 1.39 for the industry. The company is likely to return 3.5% this year, in contrast to the Retail - Consumer Electronics industry’s projected negative return of 3.6%.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
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Profit from These 5 Sturdy Stocks as Fear Grips Markets
The use of the “Mother of All Bombs” on Afghanistan to wipe out Islamic terrorists has been quite a geopolitical concern for traders. This is understandable, especially at a time when ties between the U.S. and Russia are strained, thanks to the indiscriminate gassing of children in Syria. North Korea, on the other hand, is mulling over a potential nuclear attack to which U.S. Vice President Mike Pence said that the “era of strategic patience” is over with the communist regime.
Domestic worries also surface as collapse of President Trump-backed healthcare bill raised questions over the timing and scope of tax reforms and infrastructure spending plans. To top it, U.S. retail sales marked the worst two-month stretch in two years in March, adding to the pool of data that hint at soft first-quarter growth. Thus, it is imperative for investors to zero in on fundamentally sound stocks that offer decent returns and are resistant toward market turbulence.
Fear Creeps Back Into Markets
Risk-averse traders continue to remain on the sidelines after a discouraging week for the equity market. The CBOE Volatility Index (VIX), Wall Street’s best gauge of fear in the market, closed above its 200-day moving average for the first time since the presidential election. VIX spiked more than 20% last week, while stocks fell to close at session lows.
All the major indices cemented a three-day losing streak and ended the holiday-shortened week in the red. The Dow Jones and the S&P 500 dropped around 1% last week, with both remaining below their 50-day moving average, a bearish sign for the near term.
U.S. Drops ‘Mother of All Bombs’
Concerns about the geopolitical landscape have put investors in a fix. In recent times, fear was largely driven by the deployment of a GBU-43/B Massive Ordnance Air Blast (MOAB) bomb, known as the “Mother of All Bombs”, by U.S. military forces, targeting an ISIS tunnel network and personnel in the Achin district of Nangarhar Province, Afghanistan.
MOAB is the largest non-nuclear bomb which is capable of breaking through 200-feet of reinforced concrete, according to the Global Research Centre for Research on Globalization. The dropping of such a nonnuclear weapon did little to boost traders’ optimism, with stocks losing considerable ground.
Geopolitical Jitters Persist
Trading has also been marked by worries over the calamity in Syria and heightened tensions between U.S. and North Korea. As diplomats struggle to solve issues pertaining to Syria, the relationship between the U.S. and Russia maybe “at an all-time low”, as per President Trump. Both the countries clashed over a range of issues including the future of Syrian President Bashar al-Assad. White House officials had alleged Russia of trying to cover up the ghastly Syrian chemical attack. The U.S. concluded that the Syrian military used banned sarin gas in the attack that had inflicted severe casualty on many civilians.
Tensions around North Korea, in the meanwhile, are heating up as the communist state warned of a nuclear attack on the U.S, which had sent a Navy strike group toward the Western Pacific. Trump has already said that U.S. will respond to Pyongyang itself if China, one of North Korea’s allies, doesn’t act.
Investors Fear ‘Partisan Conflict’
Even though geopolitical developments are dominating the headlines, domestic worries aren’t to be ignored. The IIF, a trade group representing the world’s largest banks, noted that the Trump administration is going back to the drawing room regarding implementation of U.S. tax reforms. This means that the ambitious deadline for a tax code overhaul plan is unlikely to be reached, a heavy blow for growth stocks. Meanwhile, Trump said that the healthcare bill debacle must be dealt with before moving on to his tax overhaul plans.
Concerns surrounding the conservative Republicans blocking any infrastructure-spending plans have also hurt the momentum of construction and engineering stocks. Both these stocks have retreated 10% from their late January peak as per IIF.
Growth on the Soft Side as Retail Sales Dip
Sales at U.S. retailers, in the meanwhile, marked the worst two month stretch in March, underlying the magnitude of the loss of economic growth in the first quarter. Retail sales cover the durables and non-durables portion of consumer spending. And consumer outlays account for more than two-third of the economy.
The Commerce Department said that retail sales dropped 0.2% last month amid softening demand for automobiles. The apparent slowdown is also partly blamed on the slower than usual issuance of tax refunds by the government. However, what made the decline even worse was a government update to sales figure for February showing a drop of 0.3% in contrast to the 0.1% increase reported at first.
5 Solid Stocks to Buy Now
Given the pessimism surrounding the state of the broader markets, investing in sturdy stocks seems practical. To pick such stocks, we have chosen five large caps, typically over $10 billion, as these tend to be less risky and more stable compared to their smaller counterparts due to their size and access to capital. These stocks also provide steady dividends, which eventually make them immune to market vagaries.
Such stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy) and a VGM score of ‘A’ or ‘B’. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Metlife Inc (MET - Free Report) is a provider of life insurance, annuities, employee benefits and asset management. The company has a Zacks Rank #2 and a VGM score of ‘B’. Metlife has a dividend yield of 3.13%.
The company has a price/earnings to growth ratio (PEG) of 0.89, compared with 1.49 for the industry. The company is likely to return 16.8% this year, better than the Insurance - Multi line industry’s estimated addition of 6.4%.
Nucor Corporation (NUE - Free Report) manufactures steel and steel products. The company has a Zacks Rank #2 and a VGM score of ‘B’. Nucor’s dividend yield stands at 2.65%.
The company has a price/earnings to growth ratio (PEG) of 1.12, compared with 2.08 for the industry. The company is likely to return 67.7% this year, way higher the Steel - Producers industry’s projected increase of 33.6%.
Texas Instruments Incorporated (TXN - Free Report) designs, makes and sells semiconductors to electronics designers and manufacturers. The company has a Zacks Rank #2 and a VGM score of ‘B’. Texas Instruments has a dividend yield of 2.57%.
The company has a price/earnings to growth ratio (PEG) of 2.19, compared with 2.79 for the industry. It is likely to return 10.7% this year, higher the Semiconductor - General industry’s anticipated addition of 7.2%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Eli Lilly and Co (LLY - Free Report) is engaged in drug manufacturing business. The company has a Zacks Rank #2 and a VGM score of ‘B’. Eli Lilly has a dividend yield of 2.42%.
The company has a price/earnings to growth ratio (PEG) of 1.75, compared with 1.78 for the industry. The company is likely to return 16.6% this year, more than the Large Cap Pharmaceuticals industry’s estimated gain of 1.9%.
Best Buy Co Inc (BBY - Free Report) is a provider of technology products, services and solutions. The company has a Zacks Rank #1 and a VGM score of ‘A’. Best Buy has a dividend yield of 2.82%.
The company has a price/earnings to growth ratio (PEG) of 1.24, compared with 1.39 for the industry. The company is likely to return 3.5% this year, in contrast to the Retail - Consumer Electronics industry’s projected negative return of 3.6%.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
See today's Zacks ""Strong Sells"" absolutely free >>