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Today, The Weekly Buzzing Stocks by Billy Kawasaki and The Panic-Proof Portfolio (Stockchase Research) commented about whether BCE.TO, MSFT, ACIC, JBS, MSTR, SIDU, SLS are stocks to buy or sell.
After 3 strong years of the S&P 500, and a solid showing from the TSX this past year, it will really be about monetary policy. We assume that we're going to have a new Fed chair, which is dovish. Leading up to that we may have some volatility. Speaking of volatility, we have the renegotiation of the USMCA, midterm elections (which tend to be the most volatile years and with the highest drawdowns).
Everything underneath that is fairly supportive. There's an expectation of about 14% earnings growth for the S&P 500, which is positive. Inflation is easing, and that also supports a more accommodative monetary policy which, in turn, is constructive for stocks.
Still great momentum and great growth in many of the tech and communication companies out there. His team also likes healthcare and financials. Industrials also have a path to outperformance.
Technology and communications performed very well last year. But if you look at the Mag 7, not all of them did very well -- only a couple of them outperformed the S&P 500. We're shifting a bit more to the industrials and the financials. Probably not lowering the weighting in technology, as it still has a path to perform well. But we'll have more volatility this year, and it'll hit the higher-beta type of sectors such as technology.
Historically, some of the trepidation about a change in government does lead to greater drawdowns in midterm election years. Those years tend to be weaker, same as with the presidential cycle.
However, volatility can lead to opportunities to buy things that have gotten a bit cheaper. Same as we saw last April with "Liberation Day".
Leading global medical device company -- cardiology, endoscopy, etc. Long term, will benefit from aging demographics and increased volume of procedures. Long-term, durable organic growth in earnings and revenue. However, seeing near-term technical weakness most likely due to high valuation. Share price has fallen below 200-day MA, which itself is starting to trend a bit lower.
In the space, he prefers some of the larger pharma names, and logistics companies such as MCK.
One of the first names that comes to mind for exposure to the industrial space. Fairly inexpensive at just 8 bps.
With recent events in Venezuela (and that's a longer-term type of thing), he certainly sees the path for more infrastructure buildout around the world. Obviously, some of the US names are multinational so you could stick with those. There are global names out there, but the US names will get you far.