Скачать или смотреть Will the new hawkish Fed push growth stocks down even further?

Since the early January peak there has been a sharp contrast in how value and growth markets have performed. Growth keeps leading the decline in 2022. The performance spread between the S&P 500 Value and S&P 500 Growth indices is now over 13%. While the S&P 500 is down almost 8% YTD, the largest contribution has been from inflation sensitive high growth companies. The S&P 500 Value index has remained mostly flat YTD, mostly held by Energy and Utilities.

Rather than investing in a broad Value style ETF, I advise to get directly into the most defensive sectors: Energy, Utilities have been the winner for the month and YTD.

While energy is extended there’s no sign of the trend reversing yet, the same for Utilities. I like to use ETF’s when doing short term sector trades and include stop losses as part of the discipline when doing purely tactical trading.

Weeks Ahead:

Even though investors already knew the Financials sector expected over a 20% contraction in earnings for Q1, there’s enough nervous sentiment to send investors into further selling when banks report lower profits and guidance further contractions in all remaining 2022 quarters. So though the recent reports SHOULD have been baked into market prices, I think the jittery environment could keep see selling until we start getting reports without a negative sign in the headline. Financials has the worst expectations of all sectors in 2022, by a large margin. Cautious investors may want to stay on the sidelines in cash until we are further ahead in earnings season. Industrials has a very positive outlook for the year. Also traditional Information Technology expects profit to expand rapidly in 2022. As those companies dominate headlines, we might see less cautious behavior. Perhaps with broad markets even testing previous highs as we move in a new consolidation range.

And for those investors being very cautious there’s always gold, which has held up during “risk off” periods. GLD or IAUF , both ETF’s that invests in gold futures, not miners, is an easy way to trade quickly into a defensive position and wait on the sidelines for a few days.