U.S. stocks seem to have shrugged off all uncertainties regarding nagging trade tensions between the United States and China. The one-month-long trade tantrums of the United States (first with China and then with Mexico) have eased as Fed Chair Powell hinted a possible rate cut to keep economic expansion going.
Like several analysts and economists, we too believe that the U.S.-China tariff battle is a threat to the American economy as it could hurt manufacturers and consumers. Against this worrisome environment, central bank’s likely intervention came as a relief to investors.
At the current level, according to CME FedWatch tool, there is a 47.2% chance of a 50-bp rate cut in the Sep 18 meeting, followed by a 34.1% probability of 25-bp rate cut, 12.6% likelihood of a 75-bp rate cut and only 6.1% probability of a no-rate-cut scenario.
Thanks to rate cut hopes, the Dow Jones Industrial Average rallied more than 500 points on Jun 4 followed by a 207-point jump on Jun 5. The Nasdaq which slipped into a correction zone to start the month, also recoiled swiftly.
Why High-Beta & Momentum Investing Is Intriguing Now
Notably, high-beta and high-momentum products are expected to lead the market. This is because high-beta funds experience larger gains than the broader market counterparts in a bullish market. And momentum investing might be an intriguing to those seeking higher returns in a short spell. It looks to reflect profits from buying stocks that are sizzling on the market.
Below we highlight a few high-beta and high-momentum stocks that could offer investors some outstanding gains. For this we highlight stocks that have a Momentum Score of A’, Zacks Rank #1 (Strong Buy) or 2 (Buy) and a beta greater than one.
Arconic Inc. (ARNC - Free Report)
The Zacks Rank #1 company Arconic was carved out of aluminum giant Alcoa on Nov 1, 2016. The company describes itself as a global leader in multi-material, precision engineered products and solutions for a variety of industries.
Metropolitan Bank Holding Corp. (MCB - Free Report)
The Zacks Rank #1 Metropolitan Bank Holding is the holding company for Metropolitan Commercial Bank(R), The Entrepreneurial Bank. The company is a chartered commercial bank which provides deposits, small business lending, trade finance, cash management solutions, speciality markets, personal checking, savings, electronic banking and prepaid cards.
Astronics Corporation (ATRO - Free Report)
The Zacks Rank #1 company is a manufacturer of specialized lighting and electronics for the cockpit, cabin and exteriors of military, commercial transport and private business jet aircraft.
Oasis Midstream Partners LP (OMP - Free Report)
Oasis Midstream Partners LP is a master limited partnership company. It owns, develops, operate and acquire a diversified portfolio of midstream assets primarily in North America. It also has a Zacks Rank #1.
Howard Hughes Corporation (HHC - Free Report)
The Zacks Rank #1 company operates as a real estate company engaged in the development of master planned communities and other strategic real estate development opportunities across the United States.
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