“We think it is wrong to position for a recession given still extremely favorable financing conditions, very strong labour markets, under-leveraged consumer, strong corporate cash flows and banks’ strong balance sheets. The sector leadership remains risk-on, and it is not consistent with a continued slowdown,” Matejka said in a new note to clients.
Matejka thinks investors should stay bullish on banks, mining, energy, insurance, autos, travel and telecom stocks.
“We believe one should look through the widespread ‘slowdown’ calls that are currently in vogue,” Matejka adds.
The Dow Jones Industrial Average (-6.2%), S&P 500 (-8.8%) and Nasdaq Composite (-13.4%) are all down for the year.
Slowdown worries have hammered the once hot FAANG (Facebook’s parent company Meta, Amazon, Apple, Netflix and Google) complex even more — the average stock in this cohort is
the yellow metal knocks on the door of $2,000 an ounce. Shares of dividend-paying, consistent growing soda giant Coca-Cola are trading at a record high.
“Upcoming recession scare best played via long bonds-short commodities,” said the latest Bank of America fund manager survey.
