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The 2017 Economy: Hot, Cold or Just Right?

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Welcome to Episode #62 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

In this episode, Tracey is joined by John Blank, Zacks Chief Equity Strategist and the Editor of Zacks Large Cap Trader. John is also an economist, so who better to ask about what could go right, and what could also go wrong, with the US economy in 2017?

Tracey and John discuss:

1.      The spiking 10-year treasury. Will yields slow the economy in 2017? John describes the 2017 economy as 2014 redux. Remember, back in 2014, rates also spiked to nearly 3%. But John believes “this time is different.” Find out why.

2.     Could the US go into a recession in 2017? John describes what really makes a recession. It’s not what you think. And he and Tracey debate whether or not the conditions could be favorable for one in 2017.

Remember, John correctly predicted on the podcast in early 2016 that there would NOT be a recession this year. You can listen to that podcast here.

Their Favorite Stocks for 2017

Despite the surge in the small cap indexes to end 2016, Tracey and John are fans of mid and large cap stocks for 2017.

1.      Seagate (STX - Free Report) is one of John’s picks. It is both cheap and pays a fantastic dividend yielding 6.2%.

2.     Western Digital (WDC - Free Report) is a favorite of John’s. It trades with a forward P/E of only 12.5 and also pays a juicy dividend yielding 3.5%.

3.     Tracey still likes the energy stocks like BP (BP - Free Report) . It has been entering into deals and pays a dividend of 6.5%.

4.     Semiconductors are another favorite area for Tracey. Nvidia (NVDA - Free Report) remains one of the hottest stocks in the S&P 500. Cree Inc , the LED components and chip maker, just raised second quarter guidance.

 

What other surprises should you prepare for in the US economy in 2017?

Tune into this week’s podcast to find out.

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