Here is one possible clear signal. COVID-19 is no longer a “tail risk” for investors, for the first time since February 2020, Bank of America said in its latest fund manager survey. A star risk is an unlikely event that can cause losses or gains to an extraordinary extent.
Scroll down for that chart.
Meanwhile, the Federal Reserve’s two-day policy meeting begins Tuesday, and investors will be on the lookout for any hawkish signals that could take some steam out of the stock. The emerging market is showing mixed action, although many are still stuck with the idea of a post-pandemic boom, at least in the US as vaccinations begin.
Read: Value stocks are returning. Do not be left behind, say these analysts
It held the records for the Dow Jones Industrial Average DJIA,
and S&P 500 SPX,
and those shares are aimed at recovery. We call of the day comes from Bank of America strategists, who are offering 17 shares to buy for the three Rs they see coming – recovery, reflection and repetition.
Strategists Jill Carey, Savita Subramanian and Ohsung Kwon say the economy has reached the mid-cycle phase, where inflation is usually strongest. In earlier such phases, with the exception of the technology bubble, small-scale capitalization outperformed larger ones, and value beat growth.
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The Bank of America team says there are two reasons to like these stocks: many of the companies highlighting them are still not expensive, and active funds do not position for rising inflation, with greater exposure to mega than smaller capital.
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On the shares (almost half are small to medium-sized enterprises) …
Alcoa AA,
BofA has a share price of $ 37 for the miner. Aluminum prices can go either way, but global demand for growth is a plus for Alcoa.
Axalta Coating Systems AXTA,
– The share price targets £ 37 for the global coverage group. The pace of car repair will be important and a stronger dollar and lower raw material costs could give a boost.
Broadcom AVGO,
– Target price of $ 550. The risks for the semiconductor company include the sensitivity to trade relations between America and China and competition in network, smartphone and other markets.
Hess HES,
– Target price of $ 95. Under the risks of the energy company fall oil and gas prices, as well as the development of drills.
Marriott International MAR,
Stock price target $ 150. Economic weakness and poorer spending than expected by businesses and consumers is one of the risks to the hospitality business.
Walt Disney DIS,
The $ 223 price target for the ‘best-in-class assets’ entertainment giant. Disadvantage risks include slowing ESPN growth by people deciding not to hold a cable television subscription, weaker consumer confidence and low theme park attendance. Also look out for possible movie flops.
As for the rest, they like CNH Industrial CNHI,
Comcast CMCSA,
Emerson Electric EMR,
Herc Holdings HRI,
Knight-Swift Transport KNX,
Occidental Petroleum OXY,
Parker Hannifin PH,
Main financial PFG,
Robert Half International RHI,
Union Pacific UNP,
and World Fuel Services INT,
The graph
Here is the ‘tail risk’ chart of the latest BofA monthly fund manager survey. Larger risks are higher than expected inflation and a ‘rage’ in the bond market.
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The markets
Equity futures contract YM00,
ES00,
NQ00,
staggers slightly, but European equities are higher SXXP,
It was also an open day for Asian markets. Elsewhere, oil CL.1,
and the dollar DXY,
is softer and bitcoin BTCUSD,
support further away from the $ 60,000 hit this weekend.
The buzz
Retail sales and import prices must be paid before the market is open, followed by industrial production and a National Association of Home Builders Index. Aside from kicking off the Fed meeting, investors will also be watching the outcome of a 20-year Treasury bond auction.
Ray Dalio, the founder of Bridgewater, the world’s largest hedge fund firm, says investing in bonds is “stupid” and should keep investors in a “well-diversified portfolio.”
AstraZeneca AZN,
AZN,
the shares are higher after Jefferies upgraded the drug company to buy out of possession. AstraZeneca was in the hot seat as several European countries suspended its COVID-19 shots due to reports of blood clots due to vaccinations.
Finnish telecommunications group Nokia NOKIA,
NOK,
cut to 10,000 jobs to save $ 716 million over two years.
A team from the U.S. government’s highway safety agency is on its way to Detroit to investigate a “violent” accident after a TESla TSLA,
vehicle drove under a trailer and left two people seriously injured.
Random reading
Office nostalgia – Redditers swap colleagues-from-hell stories.
If a hacker gets all your text for $ 16.
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