As the likelihood of a hard landing this year rises, Barclays says investors should seek quality stocks that are not overly expensive. Large-cap tech stocks have been outperforming the market in 2023, with the S & P 500's tech sector up more than 16%. However, Venu Krishna, Barclays' head of U.S. equity strategy, warned against following this trend, citing elevated valuations, as well as inflation and interest rate risks.
The pharmaceutical company is a notable winner in the Dow since the Fed began its latest rate-hike cycle . Shares are down more than 3% this year. About 7 out of 10 analysts covering Merck rate it a buy or are overweight on the stock, according to FactSet. They see upside of nearly 13%. Industrial names United Postal Service and 3M were also chosen as safe picks for a potential hard landing.
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