Even though fear and uncertainty has returned to the market, these seven stocks have outperformed on a consistent basis so far this year. With strong and long-term macroeconomic trends fueling revenue and earnings growth, buy these stocks for years of outperformance no matter what happens in the market.
Chaos returned to the global markets on Friday. After equities rallied this Thursday on the belief that the U.K. would vote to stay in the EU, just the opposite occurred when votes were tallied. It appears this will turn out to be one of the bigger mistaken assumptions in recent memory.
Once again, the so called elite and economic pundits have not taken into account how much anger and angst permeates the electorates in developed nations across the world after a decade of slow economic growth, tepid job gains, increases in terrorist acts, major expansions of regulations, and massive interventions by the world’s central banks. Looking back with hindsight, England deciding to leave the EU seems almost logical given those cross currents.
You only need to look at our recent election primaries to see how unpredictable these forces are at the moment. This event will have ripple effects across global markets for weeks and we will see over time whether the U.K. is just a one-off event or the start of other nations reasserting their sovereignty and leaving the European Union as well.
The next potential trouble spot for our market will be second quarter earnings reports which will start to trickle in in the next couple weeks. They are expected to show the fifth straight quarter of profit decline within the S&P 500 as we continue to be locked in a “profit recession†since the early part of 2015.
However, not all sectors of the economy and market are seeing earnings declines of course. One area of strength is housing. Last week two of the largest home builders, KB Home (NYSE: KBH) and Lennar Corporation (NYSE: LEN) both delivered solid results and saw their stocks rise nicely as a result.
