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4 Safe Stocks to Buy as Wall Street Posts Worst Week in 2023
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All three major indexes in the United States suffered weekly losses, and most of the listed stocks ended sharply lower on Feb 24. The S&P 500, the Dow, and the Nasdaq posted their biggest weekly losses in 2023. For the week, the S&P 500 slipped 2.7%, leading to its worst week since Dec 9.
The Dow fell 3%, its fourth straight weekly loss, and registered its longest weekly losing streak since May 2022, added the Dow Jones Market Data. The blue-chip index also booked its worst weekly percentage drop since September 2022. The Nasdaq, too, finished 3.3% lower and registered weekly losses in two out of the last three weeks.
So, what lead to a bloodbath on Wall Street? A hotter-than-expected Federal Reserve’s preferred inflation gauge was primarily responsible for hurting the stock market. The personal consumption expenditure (PCE) index increased by 0.6% in January, way more than the 0.2% rise in December.
Similarly, the PCE Index advanced 5.4% year over year last month from an increase of 5.3% in December. Excluding the volatile food and fuel prices, the PCE Index still increased and all the readings were higher than anticipated.
Prices of gas, fuel, and shelter, to name a few, in reality, scaled upward, regrettably, at the beginning of 2023. The consumer price index (CPI) advanced by 0.5% in January and registered an annual gain of 6.4%, easily topping analysts’ expectations. The core CPI also increased by 0.4% last month and 5.6% year over year, more than what market pundits’ have forecast.
Now, inflation remaining stubbornly higher this year despite showing some signs of ebbing in the latter half of last year has raised concerns that the Fed will continue to remain aggressive in its monetary policy stance. The central bank is expected to continue hiking interest rates to quell inflationary pressure.
Most of the market participants at present expect the central bank to increase interest rates by 25 basis points in March as well as in May. Such a move will push the policy rate to reach 5.36% by mid-summer and could remain elevated at that level for the rest of 2023.
However, rate hikes increase the cost of borrowing, discourage consumers from spending, and deter economic growth, resulting in volatility in the stock market. Thus, currently, higher inflation leading to rate hike expectations eventually weighed on the markets.
But investors shouldn’t panic! They should instead invest their hard-earned money in stocks that provide risk-adjusted returns, like NiSource Inc. (NI - Free Report) , Spire Inc. (SR - Free Report) , Conagra Brands, Inc. (CAG - Free Report) and Philip Morris International Inc. (PM - Free Report) .
These stocks have a low beta (ranges from 0 to 1) and are dividend players. Hence, they have a solid business model and are less susceptible to market uncertainty. They are also non-cyclical in nature since they are part of the utility and consumer staples sectors. This makes them immune to market volatility. These stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NiSource is an energy holding company and, together with its subsidiaries, provides natural gas, electricity, and other products and services in the United States. The company has a beta of 0.48 and a Zacks Rank #2.
NI has a dividend yield of 3.59%. The Zacks Consensus Estimate for its current-year earnings has moved up 0.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 5.4%.
Spire is a natural gas company efficiently serving more than 1.7 million customers in the United States. The company has a beta of 0.46 and a Zacks Rank #2.
SR has a dividend yield of 4%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 8.8%.
Conagra Brands is one of the leading branded food companies in North America. The company has a beta of 0.56 and a Zacks Rank #1.
CAG has a dividend yield of 3.6%. The Zacks Consensus Estimate for its current-year earnings has moved up 8.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 12.7%.
Philip Morris operates as a tobacco company working to deliver a smoke-free future. The company has a beta of 0.68 and a Zacks Rank #2.
PM has a dividend yield of 5.2%. The Zacks Consensus Estimate for its current-year earnings has moved up 10.3% over the past 60 days. The company’s expected earnings growth rate for the current year is 5.5%.
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4 Safe Stocks to Buy as Wall Street Posts Worst Week in 2023
All three major indexes in the United States suffered weekly losses, and most of the listed stocks ended sharply lower on Feb 24. The S&P 500, the Dow, and the Nasdaq posted their biggest weekly losses in 2023. For the week, the S&P 500 slipped 2.7%, leading to its worst week since Dec 9.
The Dow fell 3%, its fourth straight weekly loss, and registered its longest weekly losing streak since May 2022, added the Dow Jones Market Data. The blue-chip index also booked its worst weekly percentage drop since September 2022. The Nasdaq, too, finished 3.3% lower and registered weekly losses in two out of the last three weeks.
So, what lead to a bloodbath on Wall Street? A hotter-than-expected Federal Reserve’s preferred inflation gauge was primarily responsible for hurting the stock market. The personal consumption expenditure (PCE) index increased by 0.6% in January, way more than the 0.2% rise in December.
Similarly, the PCE Index advanced 5.4% year over year last month from an increase of 5.3% in December. Excluding the volatile food and fuel prices, the PCE Index still increased and all the readings were higher than anticipated.
Prices of gas, fuel, and shelter, to name a few, in reality, scaled upward, regrettably, at the beginning of 2023. The consumer price index (CPI) advanced by 0.5% in January and registered an annual gain of 6.4%, easily topping analysts’ expectations. The core CPI also increased by 0.4% last month and 5.6% year over year, more than what market pundits’ have forecast.
Now, inflation remaining stubbornly higher this year despite showing some signs of ebbing in the latter half of last year has raised concerns that the Fed will continue to remain aggressive in its monetary policy stance. The central bank is expected to continue hiking interest rates to quell inflationary pressure.
Most of the market participants at present expect the central bank to increase interest rates by 25 basis points in March as well as in May. Such a move will push the policy rate to reach 5.36% by mid-summer and could remain elevated at that level for the rest of 2023.
However, rate hikes increase the cost of borrowing, discourage consumers from spending, and deter economic growth, resulting in volatility in the stock market. Thus, currently, higher inflation leading to rate hike expectations eventually weighed on the markets.
But investors shouldn’t panic! They should instead invest their hard-earned money in stocks that provide risk-adjusted returns, like NiSource Inc. (NI - Free Report) , Spire Inc. (SR - Free Report) , Conagra Brands, Inc. (CAG - Free Report) and Philip Morris International Inc. (PM - Free Report) .
These stocks have a low beta (ranges from 0 to 1) and are dividend players. Hence, they have a solid business model and are less susceptible to market uncertainty. They are also non-cyclical in nature since they are part of the utility and consumer staples sectors. This makes them immune to market volatility. These stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NiSource is an energy holding company and, together with its subsidiaries, provides natural gas, electricity, and other products and services in the United States. The company has a beta of 0.48 and a Zacks Rank #2.
NI has a dividend yield of 3.59%. The Zacks Consensus Estimate for its current-year earnings has moved up 0.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 5.4%.
Spire is a natural gas company efficiently serving more than 1.7 million customers in the United States. The company has a beta of 0.46 and a Zacks Rank #2.
SR has a dividend yield of 4%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 8.8%.
Conagra Brands is one of the leading branded food companies in North America. The company has a beta of 0.56 and a Zacks Rank #1.
CAG has a dividend yield of 3.6%. The Zacks Consensus Estimate for its current-year earnings has moved up 8.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 12.7%.
Philip Morris operates as a tobacco company working to deliver a smoke-free future. The company has a beta of 0.68 and a Zacks Rank #2.
PM has a dividend yield of 5.2%. The Zacks Consensus Estimate for its current-year earnings has moved up 10.3% over the past 60 days. The company’s expected earnings growth rate for the current year is 5.5%.