BXSL - Sell Alert: Two High-Yield Sectors Getting Risky
2024-06-28 13:23:55 ET
Summary
- I am very bullish on high-yield stocks right now.
- However, there are a few high-yield sectors that, I think, are getting quite risky, and I am avoiding as a result.
- I detail two of these sectors and also share some of the more attractive high-yield opportunities of the moment.
In general, I'm quite bullish on high-yield stocks ( SCHD ) right now, as it appears that inflation is increasingly under control and likely to trend lower over time. Additionally, the economy is weakening, with unemployment rising to around 4% recently, and typically, a weakening economy favors more defensive, interest rate-sensitive high-yield stocks. Moreover, numerous central banks, such as the Bank of Canada and the European Central Bank, have begun to cut interest rates. As a result, all these factors should push the Fed to cut interest rates sooner rather than later, which should be very bullish for high-yield stocks that have been beaten down by elevated interest rates....
Sell Alert: Two High-Yield Sectors Getting Risky