Stock market, which stocks to invest in after a record six months: all occasions – Corriere.it

The necessary movement

To continue running, healthy sector rotation would be needed and in this case, the stocks that lingered in the first part of the year should rise: industrials, utilities, energy and the category of mid-small cap. In this context The Economy of Corriere della Sera compared the companies with the highest capitalization, i.e. those that have achieved the best performance in the first 6 months of 2023 and which instead have lagged behind the main index. The dividend yield and the price/earnings ratio will also be in the spotlight, variables that will be taken into great consideration by operators in a context of reduction in interest rates on government bonds and a recession. The results are shown in the table on the page. At the halfway point, the banks were found, with Unicredit and Bper Banca which achieved increases of more than 50%, much better than the Ftse Mib 40 index, which with +20% in six months, was in any case the best price list in Europe and among the top 3 in the world.

Push ups

On the other side of the coin, Diasorin, FinecoBank and Tenaris, belonging to different sectors but sharing double-digit stock market losses, despite anything but negative fundamentals. Investors are therefore at a crossroads: continue to ride the winners, or change horses? A compass could come from the trend of the most recent macroeconomic data which on the one hand indicate a mild recession, both in the USA and in Europe and on the other hand a less rapid drop in inflation than expected, particularly in the USA. A situation that leads us to look carefully at industrial and energy companies.

This list could therefore include Tenaris and Erg. Both stocks are trading in negative territory year-to-date. The group producing steel for the piping industry is highly exposed to the trend in crude oil prices and production which reflect expectations on the trend of the world economy. Forecasts that are now turning to the good and are reflected in the prices of black gold which jumped by 3% in one week and returned steadily above the 70 dollar threshold. There is therefore a possibility of recovery for Tenaris which, despite record numbers in the first quarter of the year, still trades more than 20% below its 12-month highs. A boost could come from the flow of strategic news. Mediobanca Securities has Outperform following the announcement that Tenaris has finalized the increase of its stake in the Brazilian Usinas Siderurgica de Minas Gerais. Positive judgment also from Jefferies which, in view of the half-year results, which will be released on August 2nd, has communicated that it has started coverage of the stock with a judgment Buy it’s a target price of 19 euros.

THE balance sheet data could also rekindle the spotlight on FinecoBank which has accumulated a loss of over 17% since January. In June, net inflows amounted to 765 million euro, bringing the total since the beginning of the year to over 5 billion. The acquisition of new customers was also positive with 9,100 new entries for a total of over 1.5 million. Context that prompted Equita Sim to confirm the rating Buy with target of 17.5 euros. The data – the experts explain – confirm a solid picture for the Fineco platform, even more important because they were acquired without short-term commercial policies and in a month that is still complicated for the markets.

The utilities

Among the latecomers, there is also much interest in defensive but high-yield companies. With the summer, the rises in the cost of money should end and consequently the share coupons will become competitive with those of government bonds. Let’s think of Italgas and Snam which have separated their dividend with a yield close to 6% and have a good chance of doing the same next year. Both stocks lose almost 10% compared to blue chip. Eni is also one of the high-yield companies that could be rediscovered in the event of sector rotation. From January to today, quotations have moved around parity and the stock trades at very low valuations, the reflection of profits at a record level in 2022. A hope of stock market recovery linked to the listing of Plenitude, the subsidiary in the field of production and distribution of energy that could take place in 2023 if a favorable market window were to open. News that prompted Equita Sim to confirm the judgment Buy with a target of €19.50.