As positive economic data rolls in, investor confidence in a solid economic recovery is rising. Consequently, all the three major indexes are hitting new highs each week. And although investors continue to be concerned about rising Treasury yields and inflationary pressures, they appear pleased with the government’s stimulus measures and improving employment data. As such, we think Daimler AG (DE:DAIGn) (DDAIF (OTC:DDAIF)), Hologic (NASDAQ:HOLX), Getinge AB (GNGBY), and Hill-Rom Holdings (NYSE:HRC) are well positioned to benefit in current market conditions. Let’s review these names.The COVID-19 pandemic precipitated the biggest economic crisis of the century. However, the stock market has recovered and galloped ahead since its major correction in March 2020. The broader market hit several new highs last year and that momentum has been continuing so far this year. The S&P 500 has returned more than 45% over the past year. In fact, during Wednesday’s trading session, the Dow Jones Industrial Average hit a new intraday record, rising nearly 200 points at one point, and ending at a new closing high.
There are several factors that are influencing the market’s run. The most prominent of them is investors' growing optimism about a solid economic recovery this year. Also, the Biden administration has been making proactive economic decisions to help the country to recover quickly from the pandemic’s ravages. Following a $1.9 trillion rescue package, President Biden now aims to inject billions of dollars more into the economy through a sweeping infrastructure bill.
Because the Federal Reserve is maintaining its accommodative stance, consumer spending is steadily returning to pre-pandemic levels. Job growth has also been coming on strong over the past three months. Together with better-than-expected progress on the mass vaccination program, indicators of a solid economic recovery this year are strong. However, one fly in the ointment that is of concern to investors is the potential for inflation. Notably, the Consumer Price Index (CPI) rose 2.6%, year-over-year, in March this year--its highest level since 2018.