The markets today, Thursday, look to start on a positive note with major North American indicators in the green and European indicators in the red at time of writing.
(These indicators can change during the runup to the opening bell and at any time afterwards. Yesterday some indicators flipped from red to green just as the markets opened.)
Earlier in the week I suggested one strategy for dealing with stock market uncertainty: focusing on businesses rather than markets. Today, I’ll focus on defensive safe haven stocks. Some of these stocks may not be as ‘sexy’ or as high-flying as investors would like – or have come to expect. However, they fall into the ‘sleep better at night’ category.
Bank of America recently listed a series of large cap stocks that qualify for defensive status. In tech it listed Microsoft, Apple, Alphabet and Amazon. Microsoft and Amazon have staked out their intentions for the cloud while Apple is staking out its position in software and entertainment as well as hardware. Amazon will most likely continue its pandemic-induced growth.
In financials, Bank of America listed JPMorgan Chase. A contrarian view would point to JP Morgan’s $920 million fine for trading manipulation though it appears to be retaining its status as ‘gold standard’ amongst banks. The market appears to be moving past this episode.
Also in financials, BofA listed Visa, an expensive but ‘safe’ stock with pandemic-induced growth potential.
In consumer stocks, BofA included Disney, though the market ‘read’ on its recent announcement of layoffs of 28,000 is not yet clear at time of writing and PepsiCo, where the wide portfolio of products appears likely to appeal to most tastes.