Many investors now predict a market crash triggered by the continuing spread of COVID-19, supply chain disruptions, and high inflation. Hence, we think it could be wise to bet on quality stocks UnitedHealth (UNH) and Target (TGT) due to their resilience to market fluctuations, continued outperformance, and high institutional ownership. Let’s discuss.Even though the stock market got a boost from solid third-quarter earnings reports, a supply chain crisis and high crude oil prices still exist and have been increasing inflation risks. Federal Reserve Chair Jerome Powell said last week that the U.S. central bank should now start the process of reducing its support to the economy by cutting back on its asset purchases, however. The bank’s ultra-loose monetary policy, in part, has led to stretched valuations for several fundamentally weak stocks.
The possible impact of rising COVID-19 cases on the economic recovery could lead to further market volatility. According to a Bankrate survey, most top experts believe a stock market correction is likely next year.
Against this backdrop, we think it could be wise to bet on fundamentally strong stocks UnitedHealth Group Incorporated (NYSE:UNH) and Target Corporation (NYSE:TGT). They are rated ‘Strong Buy’ or ‘Buy’ in our POWR Ratings system. In addition, these stocks possess a solid combination of growth and stability attributes.