CoViD-19; bad for our health, good for the stock market – is it time to invest?
Analysis by Karim Bassil, Staff Writer
April 1st, 2020
The world is currently facing a pandemic, and the stock market has clearly crashed. However, for some investors or people who have a few hundred dollars to spare, it would be a good idea to invest in stocks right now. Due to the sudden decline of stock prices people should look into certain companies that sell products and services that are used on a day to day basis. Since February 19, 2020, approximately 34% has been lost from the benchmark S&P 500, stock market is basically nosediving. Clearly, none of us have an upper hand on the coronavirus disease (CoViD-19). It was clear that the virus has spread at an exponential rate and that countries lost total control over it, despite efforts to “flatten the curve”. Wall Street called for an almost unimaginable decline in the second quarter for the U. S’s GDP of 24%.
The numbers so far are looking pessimistic; it is no surprise that one would clearly be weary of the situation and would rather stuff all their money under their mattresses. However, there is a silver-lining to all of this, and it is knowing that on the long run, top businesses tend to increase in value. Over the years, at each downturn the market has faced, it was eventually erased and put away by a bull-market rally. In layman terms, you do not really need a small fortune to be successful. If you have spare cash, not money needed to pay bills or reserved for emergencies then you should be putting it to work and buy stocks.
One should be looking at U.S airlines right now; Delta, United, American, are all descent long term buys right now. That is due to no flights going on and their stocks being in the ground it would be smart to buy some now while waiting for the pandemic to leave us. Also, defense contractors – i.e. General Dynamics, or telecom companies – i.e. Dycom. Applied Materials is also a good buy right now. The company supplies equipment, services and software for the manufacture of semiconductor chips for electronics, flat panel displays for computers, smartphones and televisions, and solar products. They had a solid year in 2019 and start for 2020 they are set for a rebound. VISA is at a good value; they will probably have great third quarter earnings and investing comes with a lot of great securities. ELF, the beauty products company, is in S&P if you are interested in investing in such a company and it would beneficial if you want a better spread in what and where to invest. Keep in mind that you are going to have to cover the portfolio management costs for ELF. If you are looking to seriously get into ELF, the best bet for trading is TD Ameritrade for individual security investments or an investment firm like Vanguard for portfolio management. 5G tech suppliers – i.e. KLA, are a good purchase right now. It is necessary to have a clear entry and exit strategy in this market. You might also opt for options trading. There will be a significant risk in trading, but your capital gains are tremendous right now.
The market is quite volatile, so you have to choose your investments wisely. Anything can happen from here to the coming month; the CDC will either have CoViD-19 under control and the market begins to go up or it will nosedive even further. So, your best is to invest now or sit on the idea till mid-April to see what happens.