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The markets just closed out what proved to be a volatile first half of the year.
Federal Reserve rate hikes, escalating trade tensions and tumbling foreign markets all helped push the Dow Jones Industrial Average to a 1.8 percent loss in the first half, the worst first-half performance in eight years; U.S. equity futures pointed to a lower open in premarket trading Monday.
So now what?
Money managers are identifying four stocks to watch in the second half of the year, and just told CNBC’s “Trading Nation” what’s on their radar.
Dow stocks on watchFor Michael Bapis, partner and managing director at the Bapis Group at HighTower Advisors, Intel is at the top of his mind. He’s bullish on the chipmaker for the long term, and expects upside into year-end. Intel shares sank 10 percent in the last month, but Bapis says the name is a leader within the semiconductors, poised to rise again.
Intel year to date
“This recent pullback is caused by trade war fears, talks between the U.S. and China, and we’re going to get back to fundamentals on the company. They have a deep product pipeline, which is driving earnings growth,” Bapis said Friday, adding he’s not concerned about the company’s CEO stepping down.
Merck year to date
He’s also bullish on two other blue-chip names into year-end: J.P. Morgan and Merck. He’s said Merck, the second-best performing Dow stock over the last three months, is a standout pick within health care, while J.P. Morgan is a solid choice in the financials.
J.P. Morgan year to date
Shares of the investment bank have fallen 2.5 percent year to date amid the broader financial sector rout.
Others say a rotation will play out between growth and value stocks, and beaten-down sectors like consumer staples and utilities will stage comebacks. Gina Sanchez, CEO of Chantico Global, is particularly focused on the utilities-tracking XLU ETF. Within the group, she likes Exelon, an energy generation and delivery company.
“We’re looking for rotations into defensive sectors, like staples and utilities, and we think utilities are particularly cheap given the fact that they have strong fundamentals, strong revenues and the pause in interest rates actually makes them look more attractive right now,” she said Friday.
Exelon shares have risen 8 percent year to date, outperforming the broader space.
Total Votes:
Not a Scientific Survey. Results may not total 100% due to rounding.
Stacey Gilbert is the head of derivative strategy at Susquehanna.
Managing Director, ACG Analytics
Managing Director, Head of Technical Analysis, Evercore ISI
AboutTrading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.
Sara EisenSara Eisen joined CNBC in December 2013 as a correspondent, focusing on the global consumer. She is co-anchor of the 10AM ET hour of CNBC's "Squawk on the Street" (M-F, 9AM-11AM ET), broadcast from Post 9 at the New York Stock Exchange.
In March 2018, Eisen was named co-anchor of CNBC's "Power Lunch" (M-F, 1PM-3PM ET), which broadcasts from CNBC Global Headquarters in Englewood Cliffs, N.J.
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