Recession-proof stocks are leading the market's latest leg higher

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Consumer Staples News

Utilities

The utilities and consumer staples sectors have popped since mid-April as investors search for value.

Stocks have rebounded from a rough April, led by two sectors that typically outperform when the economy is in a downturn.Wall Street strategists said the two sectors are likely catching up after a dismal performance to start 2024.

"With markets up so much as we're up since October, people get nervous," Lerner told Yahoo Finance. "They want to rotate into something a little more defensive, take some profit taking ... It's also just saying, 'Hey, what hasn't worked and what could have an opportunity to do some catching up or hold up better should the market correct?'"

Another key movement has come in economic data. After economic growth continued to surprise Wall Street to start the year, data took a turn in April, highlighted by a weaker-than-expected jobs report andAnd while this doesn't mean the US economy is definitely slowing down, it has caught investors' attention.

Charles Schwab senior investment strategist Kevin Gordon told Yahoo Finance he's "unsure" whether the defensive play will have staying power because when you look at what's been leading the market since the start of March, there are multiple different stories at work. Communications Services' stock looks like a great bargain after its latest plunge over the ongoing U.S. probe.

 

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