Wall Analysts: 20 stocks that can beat the bear market

By Sergei Khlebnikov

With stocks on track for one of the worst years in recent Wall Street history amid worries about persistently high inflation, US Federal Reserve interest rate hikes and the risk of a downturn in the US economy, top analysts estimate that Investors should turn to “defensive” stocks with fixed profit margins and cash flows that will withstand a bear market.

In particular, its analysts Evercore ISI Several bank bonds said on Thursday they would benefit from further interest rate hikes in the wake of the Fed’s release from its May meeting, which confirmed that US Federal Reserve officials were determined to continue the aggressive the rally of inflation.

The company singles out its shares Wells Fargo, First Republic Bank, Comerica and KeyCorpwhich potentially benefit from rising interest rates, as their balance sheets are bolstered by loans and deposits, while at the same time running “less credit risk than their competitors if the positive momentum of the economy weakens”.

Its analysts Jefferies point out that investors who want to bet on the “resilient” American consumer should turn their attention to casual dining stocks, which can capitalize on their upward trend benefiting from the recent shift in consumer spending from goods to services.

Although the outlook for inflation remains a thorn in the side, focusing on supply chains is not expected to be significant. At the same time, according to Jeffries, fixed consumer spending will work in their favor, highlighting Dave & Buster’sthe Bloomin ‘Brands –Owner of the Outback Steakhouse chain– and Cheesecake Factory.

Last week, its strategic stock analyst Morgan Stanley, Mike Wilson, predicted that the sell-off will continue, as the risk of the economy going into recession escalates. However, he identified several “high quality companies that may be able to withstand the bear market”, focusing on cases with strong free cash flows. Specifically, he singled out five “defense” shares that can be “strengthened at reasonable levels”: Exxon Mobil, Coca-Cola, Deere & Co, Abbott Laboratories and CVS Health.

For their part, its analysts UBS warned that stagnant inflation is likely to continue, as markets have not yet cost it. The bank advises investors to look for stocks with stable profit margins that will withstand stagflation, such as: Costco, Kroger, eBay and Procter & Gambleas well as Microsoft, Johnson & Johnson, Pfizer, Abbott Laboratories, Chevron and Exxon Mobil.

Inflationary pressures and further interest rate hikes have fueled concerns about a recession, which is exacerbating the investment climate. The S&P 500 ran a 7-week losing streak, the worst since 2001 (s.s .: on Friday the broader index ended this negative record, after gaining 6.6% per week), temporarily moved to an area bear market, while later removed, but remains in double digits below the all-time high of January. Recent Federal Reserve minutes show a broad convergence in the need to pursue a tighter monetary policy, with Fed officials agreeing to raise interest rates by 50 basis points at a time in the coming June and July meetings.

* How much lower will the shares fall in 2022?