Concerns surrounding rising Treasury yields and inflation are leading to extreme market volatility lately. Therefore, investors looking to hedge their portfolios could bet on dividend-paying stocks Gilead Sciences (NASDAQ:GILD), BASF (BASFY), Dow (DOW), KT (NYSE:KT), and Hillenbrand (NYSE:HI), which look undervalued at their current price levels.The U.S. Treasury yields have been rising since the Fed signaled to start bond tapering in the near term and raised inflation rate projections for this year. This has caused significant declines in benchmark indexes this week. On Thursday, the S&P 500 posted its worst monthly percentage decline since the pandemic started.
As concerns related to the continued spread of Delta coronavirus variant, inflation, and the Fed’s taper talks linger, a defensive investment strategy could be appropriate now.
Dividend-paying stocks Gilead Sciences, Inc. (GILD), BASF SE (OTC:BASFY), Dow Inc. (DOW), KT Corporation (KT), and Hillenbrand, Inc. (HI), which are currently trading at discounted valuations, could be ideal bets now to dodge the market volatility and secure a steady income stream.