Market veteran Nancy Tengler says talking about a new bull market is premature, as she calls her favorite “reliable” stocks. “I think this rally has been excellent,” Tengler, CEO and chief investment officer of Laffer Tengler Investments, told CNBC “Squawk Box Asia” last week. “Since mid-June we have increased risk in our portfolios and that has paid off. But I don’t think we are in a new bull market,” she added. She pointed to recent data indicating that inflation may have peaked, but emphasized that there is still “some work to be done” to meaningfully reverse inflation, which remains high compared to a year ago. insist. There is also uncertainty over the course of further rate hikes, as the US Federal Reserve has been “somewhat unreliable in sticking to the plan”. “You shouldn’t be chasing this rally because we don’t know if the Fed will go 75 [basis points]. We don’t know if they will make a policy mistake,” Tengler said. She noted the “tug of war” between conflicting data: For example, commodity, food and energy prices have fallen, but rents and other inflationary metrics remain high. “Don’t be a hero” Tengler’s advice to investors? “Don’t be a hero.” She’s shifting her portfolio to “more reliable growers” or companies with a proven track record of growing earnings and dividends. “We’ve removed some of the more cyclical names and put them in the added to the defense names last fall…their earnings growth is reliable and we’ve really tried to keep reliable dividend growers,” she said. The stock currently in her portfolio is music streaming service Spotify. Tengler acknowledged the high-profile challenges facing rivals. Netflix is facing but believes that the companies have different visions because of their different business models. “You can keep your music on when you leave the house. It’s not a stay at home game. And you can listen to podcasts. They’ve really, really bolstered that part of their business,” she said. Read More Tesla’s valuation makes no sense until it reaches this level, says fund manager Time to go all-in on technology? Top investor Paul Meeks shares his take – revealing what he’s buying ‘Pretty compelling value’: Analyst picks his best global stocks to resist slowing growth. we saw in earnings season that cloud providers have excellent returns on performance,” she said. She listed Microsoft, Amazon, Oracle and Google parent alphabets as some of the stocks she likes. “We also saw cybersecurity names deliver excellent returns and will continue to do so,” she added. In semiconductors, she prefers “broadly diversified” companies that she believes will benefit as the industry begins to recover and has sound capital allocation plans. Her top picks are Broadcom and Texas Instruments — two companies that return most of their free cash flow to shareholders through dividend increases and share repurchases.
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