Tomorrow I will add shares of Walmart (WMT) to my Jubak Picks Portfolio. The stock is one of the 12 “Recession Picks” in my current Special Report: A Recession is Coming–Three Portfolio Strategies for a Recession; and 12 Recession Stock Picks. Right now I think Walmart’s stock has three things going for it. And only one of those is explicitly linked to a recession, which makes it a great recession stock
This week’s Quick Pick is a utilities ETF, XLU. Utilities are a good place to turn to for the next few months before we hit a full recession slowdown. This ETF has a lot going for it, including a strong upward trend, a low expense ratio, and a good yield. As utility companies continue to invest in capacity, they are allowed to increase their rate base, which means revenue will keep going up. I own this ETF in my Perfect 5 ETF Portfolio on JubakAM.com, where it’s been up 43% since 2018.
A couple of days doesn’t a trend make, but the trading action in European wind stocks has caught my eye in the last week or so. Yesterday, Wednesday, March 30, wind turbine maker Vestas Wind Systems (VWDRY) gained 5.80%. That took the stock to a gain of 4.60% in the past week. The stock is down 2.26% for 2022 to date as of the March 30 close. Wind developer Orsted (DNNGY) was up 3.27% to bring its gain in the last week to 7.71%. The stock is down 3.88% for 2022 to date. With Europe looking to reduce its reliance on imports of Russian natural gas, increasing the region’s wind power capacity is one solution.
Tesla (TSLA) announced today that it will ask shareholders for permission to split its stock. No news yet on what the ratio of the split will be, but on the news shares of Tesla were up 8.03% at the close today, March 28, to $1,091.84.That split comes on the heels of splits from Amazon (AMZN) and Alphabet (GOOG). Which leads me to conclude that it’s time to buy shares of Costco Warehouse (COST).
Don’t sell those oil stocks yet! Back at the beginning of the year, I anticipated that coming conflict between Russia and the Ukraine would drive up the price of oil, and the stocks I added to my portfoliohene stocks (COP, EQNR, LNG) have all been up big. But, I don’t think it’s time to sell yet. Why? Summer. Summer is the big driving season in the Northern Hemisphere, and right now (in what’s called the “shoulder season”) reserves of gasoline are supposed to be replenished in anticipation of summer. But that’s not happening due to Russia-Ukraine, and I think with summer we will see prices for oil spike even higher. That’s why I wouldn’t sell these stocks yet. (And that’s despite of the selling today, March 28, on more lockdowns in China)
The city of 25 million and China’s financial hub began a phased lockdown today. A wave of Omicron infections hit a record of 3,450 daily asymptomatic cases on Sunday. That’s nearly 70% of China’s total.
On Friday, the Iranian government said an agreement to revise the nuclear deal with Iran may happen soon. All the stood in way, according to the Iranians was the U.S. decision designate the Islamic Revolutionary Guard Corps as a terrorist organizations. Surely, with Europe teetering on the edge of an energy emergency, the U.A would bite the bullet and agree to change the status of the Islamic Revolutionary Guide. But while Iranians seemed to say “No big deal” a re-rating of the Islamic Revolutionary Guide remained a deal breaker for the United States.
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My one-hundredth-and fifteenth YouTube video “Quick Pick Agricultural Commodity ETN JJA” went up today. This week’s Quick Pick is an ETN that tracks agricultural commodities. What I’m looking for is a chance to buy commodities, particularly wheat and corn, in the midst of the Russia-Ukraine war. Don’t forget that these are two of the biggest regions for producing and shipping wheat and corn. And right now nothing in grain silos in Ukraine can get out across the Black Sea. This ETN has a decent expense ratio compared to competitors and is focused on food–no oil or natural gas. I’m adding it to my portfolios in complement to the DJP ETN, which does include those energy commodities.
Projections schedule a potential Recession for the second half of 2022 or 2023. Fears of that impending trend will begin to be felt in stock prices before that. The sector most likely to feel the effects of any Recession–and thus the sector most likely to first feel the anticipation of that Recession on stock prices–is what Standard & Poor’s calls Consumer Discretionary” stocks. (The Consumer Discretionary Select Sector SPDR ETF (XLY) tracks these stocks for the S&P 500 index.) In my YouTube video yesterday, I flagged three stocks in this sector to sell ahead of any potential Recession–Netflix (NFLX), Starbucks (SBUX), and Lululemon Athletica (LULU). Of these I said I would sell Lululemon first
The United States and Europe have reached an agreement to expand U.S. supplies of natural gas to Europe in an effort to reduce Europe’s dependence on Russian natural gas.
Details are bit vague. And wishful thinking is a big ingredient. The basis problem is that Russia supplies Europe with 150 billion cubic meters of natural gas every year via pipelines. U.S. and other sources can’t match increase production to that level and the infrastructure to get the gas to Europe simply doesn’t exist. Yet the goal has now been put on paper and the agreement promises that Europe will get at least 15 billion cubic meters of additional LNG supplies by the end of the year. Even though it is not clear where the natural gas welcome from or how ti will be delivered.
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. My one-hundredth-and fourteenth YouTube video “Three Recession Sells” went up today.This week’s video takes a look at what I’m calling consumer discretionary companies and recommends that this kind of company should be your first sell as we head toward a Recession. These are places where consumers looking to save money in future economic downturn might cut back spending. I think Starbucks (SBUX), Lululemon (LULU), and Netflix (NFLX) are all stocks to avoid through the end of the year as we see a recession on the horizon. More coverage of this on my sites as well including 10 stocks to own during a Recession on my subscription JubakAM.com site.
Oil rallied again today with U.S. benchmark West Texas Intermediate up 4.79% on the day to $114.79 a barrel and international benchmark Brent up 5.12% to $121.39 a barrel. So, natural, oil and gas equities stocks are up today. And the broader market is down. What else isn’t new?
