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MarketBeat: Week in Review 9/19 – 9/23

In early Friday trading, global equity markets are in full retreat. In fact, every major exchange is now testing their June lows. As expected, the Federal Reserve raised interest rates by 75 basis points. But investors were more concerned with the remarks from Jerome Powell. The Fed chairman continued to say that the Federal Reserve is prepared to keep interest rates at elevated levels for as long as it takes to whip inflation. And central banks across the world responded by raising interest rates in lock step with the Fed’s outlook. The simple fact is that whether you use the term recession or not, the global economy is slowing. But what does that mean for your money? That’s the question that we think about every week. Our analysts give you insight into the stocks and stories that are moving the market. Here are some of the most popular articles from this week.

Articles by Jea Yu

One of the byproducts of rising interest rates is a strong dollar. And that presents a problem for companies like Oracle (NYSE:ORCL). The database and cloud solutions provider posted disappointing earnings due to forex (FX) related headwinds. In the short-term, shares of ORCL stock will remain under pressure. However, Jea Yu believes this may be creating a buying opportunity for long-term investors. For active investors looking for alpha right now, Yu points them to the consumer staples sector, and specifically Kroger (NYSE:KR), which is holding onto a single digit gain in the face of the market sell-off. Yu is also looking at the performance of Ruth Hospitality Group (NASDAQ:RUTH). The premium steak house operator is performing less poorly than the broader market. As Yu points out, this adds validity to the argument that fine dining restaurants maintain margins better than casual dining restaurants when the economy slows.

Articles by Thomas Hughes

This week, Thomas Hughes weighed in on the recent announcement by Federal Express (NYSE:FDX). As Hughes points out, the sell-off may already be overdone based on the activity of institutional investors. Investors will want to remain cautious, but FDX stock may present an opportunity for long-term investors. In the here and now, Hughes was also looking at the consumer staples sector and specifically General Mills (NYSE:GIS). As Hughes writes, GIS stock is trading at a value relative to its peers, which makes it attractive to value investors. Another stock that Hughes recommends for investors is Autozone (NYSE:AZO) which looks ready to move higher after a pullback in part because it has less exposure to the DIY sector.  

Articles by Sam Quirke

This week, Sam Quirke was helping investors understand what’s going on in the semiconductor sector.  This is always a cyclical market, but 2020 and 2021 were a super cycle for semiconductor demand. That demand has run into inflationary pressures in 2022 and the sell-off has been sharp. But is the sell-off overdone? And if it is, what stocks should investors be looking at? Read this article by Quirke to get his idea on two semiconductor stocks that look like appealing options for a sector reversal.

Articles by Chris Markoch

Investors are focusing more on the pace and scope of layoffs. But as Chris Markoch points out, the recent earnings report from Steelcase (NYSE:SCS) should be a reminder that where employees work is still an issue. And in this case, the company’s guidance suggests that the new normal may be here for some time. Speaking of the new normal, Markoch was writing about Novavax (NASDAQ:NVAX), which remains a risk-on stock because it is not meeting investors’ revenue expectations for its Covid-19 vaccine. And Markoch was also writing about Target (NYSE:TGT). As Markoch writes, the worst may be over in terms of the company’s earnings, but Markoch wonders if TGT is safe to buy for anything other than its dividend.

Articles by Parth Pala

Parth Pala was also looking at the semiconductor stock, and he offered investors his own idea for one semiconductor stock that looks like a good long-term investment. Read his article here to see why Pala believes Advanced Micro Devices (NASDAQ:AMD) is showing an intriguing set-up for investors. Pala was also writing about a way that investors may want to play the rise in natural gas prices. Specifically, Pala identified three natural gas stocks that stand to benefit from the continued imbalance between supply and demand.

Articles by Kate Stalter

One strategy for successful sector investing is to look for the best within the best. Kate Stalter provided an example of this by looking at three liquid natural gas (LNG) stocks that present buying opportunities. As Stalter points out, LNG specialists are outperforming the broader sector and are expected to benefit as winter approaches in the northern hemisphere. Another sound strategy during this sell-off in stocks is to buy dividend stocks. Stalter was looking at three dividend stocks that are also providing investors with strong price growth. Another story that Stalter was looking at involved Ford (NYSE:F). Like many companies, the company issued a pre-earnings warning while maintaining its full-year guidance. While the market was quick to respond, Stalter notes that F stock was still trading above its pre-structure low, which may provide a set-up for a rebound in the stock.

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