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5 Stocks To Rotate Into During This Risk-Off Environment

As the earnings visibility for FY19 fades, CIMB thinks that investors should temper expectations. One recommended strategy is to load up some stocks with earnings certainty or which trade at deep discounts. In addition to a risk-off environment given the volatile macro outlook amid US-China trade tensions, CIMB thinks investors should also start preparing by tactically rotating into these yield stocks.

Want To Play It Safe? Gun For The Large Caps

Once again, earnings fell short in the recent quarterly results announcement. Moving forward, nearly every sectors’ earnings forecasts for FY19 were cut during the quarter as analysts continue to take a more conservative stance. With a more muted quarter expected going forward, CIMB recommends investors to focus on large caps that are either cheap, less bad or offer firm dividends.

Yield Plays Are Sexy, Again

The Straits Times Index fell 6.2 percent year-to-date to this year’s low in early July 2018. Since then, the index has recovered some grounds and is now up 4.6 percent from the recent low in July. Like Singapore, most equity markets have erased gains for the year following uncertainty over escalating trade tensions and higher tariffs.

3 Stocks That Will Thrive In A New Era Of Mainstream IoT

Asia is set to lead the development of the Internet of Things (IoT) and Artificial Intelligence (AI) in the forthcoming decade. The Asia Pacific region excluding Japan is expected to account for about 40 percent of global IoT spending in 2018. According to DBS, IoT is at an inflexion point where adoption rate is starting to accelerate.

Seek Safety In These 4 Small Caps Value Plays

While the bear has yet to breathe down our necks in the market given the generally visible earnings growth outlook in 2018, the noises of trade war and contagion risks from emerging markets can change conditions quickly. The recent unimpressive performance of Singapore stocks despite a healthy 2Q18 earnings season is doing little to lift the sentiments. While CIMB thinks that there is no hiding place in this fragile investment environment, investors should be looking at stocks that are cheap and in relatively better shape than the rest.