Nasdaq Composite closed nearly 2.0% up on Tuesday, which, as per Mike Vogelzang, is a sign that focus is shifting from inflation to a looming economic downturn.
What a recession could mean for the U.S. equities?
Interestingly, the Captrust CIO doesn’t see much of a downside in U.S. equities if the economy indeed slips into a recession. Explaining why this afternoon on CNBC’s “Power Lunch”, he said:
One thing about this potential recession is that it’s pretty anticipated. Usually, the market doesn’t get hammered when it anticipates this much. So, there are some cheap stocks out there and I think a lot of it has been discounted.
Last month, the U.S. Federal Reserve resorted to its biggest rate hike (75 basis points) since 1994 to fight inflation. But that, according to many experts, minimized the probability of a soft landing.
Stocks Vogelzang likes for a recession
For a recession, Vogelzang likes companies with pricing power, like AT&T. Another name that pops out to him is Lam Research Corporation (NASDAQ: LRCX) that’s down more than 45% versus the start of 2022. He noted:
Lam Research is a wonderful business. We’ve been through many cycles, this is not a tradable name, in my opinion, this is a name you want to own as technology continues to advance across the globe.
The Captrust CIO is also bullish on Wells Fargo that he dubs the “cheapest bank” to own right now. It is expected to report its results for the fiscal second quarter next week.
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