Take some profits if March CPI only matches expectations, investors say

[Pelican Press 0]

Take some profits if March CPI only matches expectations, investors say

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, “just looking at all the other metrics we’ve seen suggesting it,” such as the surprisingly strong March nonfarm payrolls and February factory orders reported last week. Buy more stocks lagging the market With inflation likely to do no better than come in as expected, Kilburg is focused on trimming some of his winning positions, including Meta , Nvidia and

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, but not exit them entirely. Conversely, Kilburg is adding to positions that have lagged the market, such as industrial and health care stocks. He highlighted UnitedHealth , Lockheed Martin and 3M as among his favorite “boring, blue-chip names.” “Those are three names that I believe are blue chip, essential names to the U.S. economy,” he said. Post-it note and adhesive maker 3M, for example, earlier this month completed the spinoff of Solventum , its healthcare business. UnitedHealth apart, other healthcare stocks are also trading at a discount, Kilburg said, citing Johnson & Johnson as a potential healthcare winner. “J & J is a name where it hasn’t really seen the momentum, so I think there’s an opportunity and a discount there as well as a laggard,” he said. Buy cyclical names Bailey, formerly a healthcare analyst at Legg Mason and Stifel Financial before joining FBB in 2015, expects hotter-than-forecast inflation on Wednesday would take stocks lower. In that event, defensive stocks with high dividends in real estate, utilities, consumer staples and telecommunications — what Bailey called RUST stocks — are likely to come under pressure as their dividends fail to compete with Treasury yields. Hot inflation could also make long-term technology earnings look less attractive, leaving them vulnerable to a downdrsaft resulting from the inflation report. Cyclical stocks that stand to benefit the most from economic growth, on the other hand, tend to outperform when inflation is high, Bailey said, citing financial, energy and industrial companies as those that might benefit the most. Bailey is especially keen on financials, preferring insurance stocks or companies exposed to the insurance industry. He highlighted Marsh & McLennan , Progressive and Berkshire Hathaway as examples, and also thinks Visa stands to gain. “Visa is in between a tech company and a financial, but higher prices go straight to their bottom line,” Bailey said. The Johns Hopkins MBA also sees the larger, diversified banks as attractive in a climate of higher inflation and interest rates. Among industrial, transportation and energy providers, Bailey touted Union Pacific , Old Dominion Freight Line and Chevron as stocks he likes. Returning to his former specialty, Bailey said UnitedHealth stands to benefit from the same tailwinds as the insurance industry, able to pass on costs from higher-than-expected inflation.

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Investment strategy,Stock markets,Old Dominion Freight Line Inc,Union Pacific Corp,Visa Inc,Berkshire Hathaway Inc,Progressive Corp,Marsh & McLennan Companies Inc,Johnson & Johnson,S&P 500 Index,3M Co,Lockheed Martin Corp,UnitedHealth Group Inc,

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.com Inc,NVIDIA Corp,Meta Platforms Inc,Chevron Corp,Jeff Kilburg,Prices,Solventum Corp,Stifel Financial Corp,business news
#profits #March #CPI #matches #expectations #investors

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