Russia launched a “special military operation” in Ukraine on Thursday that spurred uncertainty in the global financial markets. Still, Dan Genter says now is not the time to sit on the sidelines.
Genter’s top sector pick
According to the CEO of RNC Genter Capital Management, weakness in several sectors is posing great opportunities to buy at present. One such pick is healthcare, he said on CNBC’s “Halftime Report”.
There’s some very distinct weakness based on the uncertainty. I think there’s some real buys right now in healthcare, which is a sector that we think has been dramatically, really undervalued and clearly is not going to get hurt in this even if the conflict escalates.
The Health Care Select Sector SPDR Fund is down more than 10% for the year. This morning, Jim Cramer also said drug companies’ stocks were a buy. In particular, he vouched for Eli Lilly as a top pick.
What else is he watching?
Genter also sees opportunity in some of the regional banks and domestic travel stocks amidst the Ukraine crisis, both of which took a beating on Thursday. Explaining why, he said:
Many feel the Fed might go on hold. If interest rates don’t go up, banks don’t have an increase in net interest margins. But we don’t think that necessarily will happen. Then there’s some domestic travel stocks that are hit a little too hard. The conflict won’t stop domestic travel. So, that might be a buy.
Earlier today, economist Mohamed El-Erian said the development in Ukraine puts the prospect of aggressive rate hikes to rest. He doesn’t expect a 50-basis point increase in interest rates next month either.
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