Towards the end of the third quarter of 2023, U.S. stock markets, which had been rallying for the first seven months of the year, began to decline. This caused fear of a volatile market in the last three months of the year. The inflation rate, although lower than in 2022, has risen 70 basis points in the last two months. The Fed, in its September meeting, kept the benchmark interest rate between 5.25-5.5%, the highest since late 2007. This decision was made in response to rising prices, with future hikes expected due to increasing crude oil prices.
Market participants are worried about a potential recession in the near term, especially due to recent turmoil in the banking sectors of the United States and Eurozone. The U.S. consumer confidence index for September 2023, released by the Conference Board, was below the recession threshold, leading to a negative short-term outlook for income, business and labor market conditions.
Investors are advised to prepare for the potential fluctuations in the market and rebalance their portfolios with suitable financial assets to maintain stability. Value stocks are considered a good choice to cushion portfolios and provide potential gains. Three value stocks in the medical sector are highlighted as potentially valuable assets: Koninklijke Philips, RadNet and Bioventus.
Koninklijke Philips, which operates under three segments—Diagnosis & Treatment business, Connected Care business and Personal Health business, is expected to see improvements in cost inflation and staff shortages over 2022. RadNet, a provider of high-quality, cost-effective diagnostic imaging services, is seeing strength in its core imaging center business and is expected to benefit from the ongoing recovery in the broader medical sector. Bioventus, a provider of clinically proven, cost-effective products for osteoarthritis and bone healing, is seeing strong demand for its Surgical Solutions.
These three stocks are expected to perform well in the coming quarters. Investors are advised to consider these stocks to maintain stability in their portfolios amidst market volatility.
In light of the market volatility and potential recession, it’s crucial for investors to make strategic decisions to safeguard their portfolios. The highlighted medical sector stocks—Koninklijke Philips, RadNet, and Bioventus—are projected to perform well, making them potential assets for investors seeking stability and growth.