Because the probability of a tough touchdown this yr rises, Barclays says buyers ought to search high quality shares that aren’t overly costly. Massive-cap tech shares have been outperforming the market in 2023, with the S & P 500’s tech sector up greater than 16%. Nonetheless, Venu Krishna, Barclays’ head of U.S. fairness technique, warned towards following this development, citing elevated valuations, in addition to inflation and rate of interest dangers. “Quite than chasing one more crowded commerce that’s weak to the subsequent unwind, we suggest looking for protected haven amongst high quality shares at much less demanding valuations,” Krishna wrote in a report on Monday. With the rising market uncertainty in thoughts, Barclays advisable a basket of high quality shares buying and selling at decrease valuations as a option to place for the rising danger of an financial downturn this yr. Check out among the names under: Well being-care big Johnson & Johnson made Barclays’ checklist. Shares have fallen 13% in 2023. The inventory is certainly one of eight names within the S & P 500 to have raised annual dividends persistently over the previous 60 years. Barclays additionally highlighted Merck as a high quality title that is low-cost. The pharmaceutical firm is a notable winner within the Dow for the reason that Federal Reserve started its newest rate-hike cycle . Shares are down greater than 3% this yr. About 7 out of 10 analysts protecting Merck charge it a purchase or are chubby on the inventory, based on FactSet. They see upside of practically 13%. Industrial names United Postal Service and 3M had been additionally chosen as protected picks for a possible exhausting touchdown. UPS shares are up greater than 7% in 2023, and the inventory is a notable dividend increaser among the many S & P 500 . In the meantime, 3M is down greater than 15% this yr. Analysts see upside of 14% from right here, based on FactSet. A number of tech shares made the checklist, together with Microsoft and Accenture . Microsoft shares have gained 15% in 2023. Greater than 8 out of 10 analysts protecting the inventory charge it a purchase, based on FactSet. The tech big’s shares have been boosted by the latest increase in synthetic intelligence . Accenture was a high performer within the prior buying and selling week after the corporate introduced it might lay off about 2.5% of its workforce , or 19,000 jobs. Shares are up greater than 2% in 2023, and analysts see upside of greater than 13%, based on FactSet. —CNBC’s Michael Bloom contributed to this report.
