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5 Stocks to Buy No Matter Who Wins the Election

5 Stocks to Buy No Matter Who Wins the Election

By    |   Tuesday, 03 November 2020 08:40 AM

As the world awaits the results of the U.S. presidential election, Barron’s has offered a handful of stocks to buy regardless of the outcome.

“No matter who wins the U.S. presidential election on Nov. 3, and regardless of which party controls Congress, the country will still be wrestling with a viral pandemic and the uncertainties of a battered economy,” the financial publication said.

“It’s difficult to predict how the markets will react to these challenges. What we can do is look at some key trends that appear to be election-proof, thus offering patient investors some long-term opportunities,” Barron’s said.

Barron’s said that the famously battered U.S. infrastructure always need attention. Some companies are already moving on their own on big job-creating initiatives, which, at a minimum, will boost construction and engineering.

“It’s hard to argue that the country doesn’t have infrastructure problems,” says Scott Davis, CEO of Melius Research. “There’s a lot of money that needs to be spent.”

There also is a giant need for greater and more accurate coronavirus testing and tracing capabilities—and that will help the companies that supply them. And a weaker dollar brings inflationary fears, which have helped fuel a 23% gain in the price of gold this year. More stimulus from Washington and an ever-swelling deficit could drive the price of the yellow metal, and the companies that mine it, even higher.

Here are five stocks that look primed for gains, regardless of the election’s outcome.

  1. Abbott Laboratories (ABT). Abbott’s six coronavirus tests drove a 39% gain in third-quarter diagnostic sales.
  2. Newmont (NEM). James Rasteh of Coast Capital calls Newmont (NEM), the world’s largest gold producer (Barrick is No. 2), another good option.
  3. SBA Communications (SBAC). SBA is a real estate investment trust that owns almost 33,000 wireless towers across North and South America.
  4. Roper Technologies (ROP). Roper makes electronic toll-payment systems like the one that runs E-ZPass. It also makes water meters that don’t require utilities to send agents to homes and video intubation technology used in Covid treatment.
  5. Carlisle (CSL). Carlisle makes roofing for schools, malls, and other commercial properties. It also produces a variety of other products, such as paint spray guns, brakes, and wire and cables, all for commercial use.

Meanwhile, with the market swings that followed President Donald Trump’s unexpected victory in 2016 still fresh in investors’ minds, many investors and money managers have spent the last several weeks reducing their exposure across assets and hedging their portfolios against post-election volatility, while a few have developed strategies that could produce handsome profits - provided they work.

“This is one of the biggest events of the year,” Dennis Dick, proprietary trader at Bright Trading LLC, told Reuters. “The uncertainty here makes the trading interesting.”

Others have prepared strategies that could benefit should volatility persist into Wednesday’s trading.

EAB Investment Group has recommended options strategies on credit and currency exchange-traded funds for clients, said Arnim Holzer, the firm’s macro and correlation defense strategist. Should the race appear tight in battleground states such as Florida and Pennsylvania, he expects high-yield bonds to underperform and the yen and Swiss franc to rally.

Analysts at TD Securities estimate the S&P 500 could climb 3% and 10-year Treasury yields could rise 15 basis points on Wednesday if Democratic nominee Joe Biden wins the presidency and his party wins 51 seats in the Senate, while the benchmark index could rise 1% and 10-year yields drop 10 basis points if Trump wins and Republicans keep control of the Senate.

An unclear election outcome, however, could result in more severe moves that day, with the S&P 500 tumbling as much as 5%and yields on the benchmark 10-year Treasury note falling by 15 basis points.

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As the world awaits the results of the U.S. presidential election, Barron’s has offered a handful of stocks to buy regardless of the outcome.
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Tuesday, 03 November 2020 08:40 AM
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