Never a dull moment during the new normal, the last five business days have created some considerable catalysts for the best stocks to buy this week. From some glimmer of hope in macroeconomic data to geopolitical dynamics to of course the recent midterm elections, investors own plenty of news items to digest and eventually respond to.
To be clear, it’s difficult to point out any one (or even a couple) factors that can dramatically influence stocks to buy this week. However, if a main theme exists, it’s that market participants must be vigilant. Certainly, developments such as lighter-than-expected inflation provide some hope that the Federal Reserve will eventually ease up on its monetary tightening policy.
Then again, betting everything on one news item is rarely smart. With so many angles to cover, these diverse market ideas represent the best stocks to buy this week.
Stocks to Buy This Week: Huntington Ingalls Industries (HII)
Two of the biggest developments to impact stocks to buy this week should bode well for shipbuilding specialist Huntington Ingalls Industries (NYSE:HII). First, Ukrainian forces liberated the southern city of Kherson, which was the only major capital that Russia took over since its late February invasion earlier this year. As a result, the retreat from Kherson represents a massive embarrassment to the Kremlin.
Second, the midterm elections in part ensnared Ukraine into American politics. Essentially, some outspoken Republicans criticized the U.S. for supporting Ukraine when other domestic problems exist — classic whataboutism. However, now that Ukrainian forces likely have irreversible momentum, politicians from both parties can effectively focus on the presumed next universal geopolitical threat: China.
As well, rogue states like North Korea expressed their military belligerence recently, thus sparking relevance for HII. In short, the way to deal with China and other Asia-based threats is to build and maintain a strong navy. That’s right up Huntington Ingalls’ alley, making HII one of the best stocks to buy this week.
Microsoft (MSFT)
Software giant Microsoft (NASDAQ:MSFT) doesn’t need much debating to justify inclusion into stocks to buy this week (no matter what week it is). However, MSFT makes for a particularly intriguing case because of its Xbox video-game console business. Broadly speaking, evidence suggests that the cheap entertainment catalyst should bode well for tech firms that can provide it.
While the idea that the Fed may let off the gas pedal regarding its monetary tightening policy attracted the bulls recently, the bigger picture states that consumer sentiment remains deflated. Therefore, the earlier phenomenon of revenge travel might not sustain itself due to the associated expenses. But video games? That’s a relatively cheap form of entertainment, which should augur well for Microsoft.
Keep in mind that content streaming platforms started looking interesting again after suffering heavy losses this year. Combined with Microsoft’s solid financial profile and a strong buy consensus rating among Wall Street analysts, MSFT easily ranks as one of the stocks to buy this week.
Stocks to Buy This Week: Progressive (PGR)
For much of the second half of this year, the benchmark S&P 500 index found itself below parity by 20% or lower. That’s the typical delineation to signify a bear market correction. Therefore, it’s been imperative for the index to swing higher, if only to bolster psychological confidence. However, insurance giant Progressive (NYSE:PGR) has had no such difficulty inspiring upside.
No, PGR will likely never be mistaken for an exciting idea. But what it does have is an underlying captive audience. Essentially, almost every state in the Union requires auto insurance. And while that doesn’t directly benefit Progressive, the company enjoys a powerful presence in the segment. As well, even under dire economic circumstances, people still need insurance to cover their finances.
Of course, if you look at PGR’s fiscal profile, it rates as a modestly overvalued investment. However, since the coronavirus pandemic, Progressive’s total addressable market cynically increased. Basically, car accidents boomed since the Covid-19 pandemic, which puts PGR in the driver’s seat when it comes to stocks to buy this week.
Wheaton Precious Metals (WPM)
Fundamentally, Wheaton Precious Metals (NYSE:WPM) really shouldn’t be outperforming under the current backdrop. Yes, I understand that inflation came in lighter than expected, which means that at some point, the Fed may relax its monetary tightening. Even granting this development, however, we’re still talking about monetary tightening. In other words, the central bank gave no indication that it will become dovish anytime soon.
Therefore, it’s quite possible that WPM increased for reasons other than monetary policy. And what enormous momentum it is! Over the trailing five days, WPM gained over 10% of equity value. In the trailing month, the rally translates to nearly 19% up. Enticingly, on a year-to-date basis, shares slipped 9.2%. It’s ugly, yes, but much improved from before.
Taking the evidence at hand, it’s possible that the fear trade may be bolstering WPM. Certainly, the tight midterm elections suggest an ongoing fracturing of American politics. With no sign of olive branch extensions, WPM represents one of the stocks to buy this week.
Stocks to Buy This Week: Coca-Cola (KO)
Back during the woes of the Great Recession, many analysts pointed to Coca-Cola (NYSE:KO) as a recession-resistant market idea. One of the most iconic American companies, the Coca-Cola brand is more than just a corporate identity; it’s really a cultural phenomenon. Just from the massive footprint alone, KO could be interesting as one of the stocks to buy this week.
Fundamentally, I appreciate the underlying “cheap thrills” argument. During bullish market cycles, people may feel no hesitation to buy their caffeinated drinks at an overpriced coffee shop. However, with a possible global recession on the horizon, consumers may trade down to soft drinks. For the price and the sugar/caffeine buzz, you don’t get much of a better deal than Coca-Cola.
Also, if outside opinion matters to you, Wall Street analysts peg KO stock as a consensus strong buy. Out of 14 total experts, 12 of them rate KO a buy while only two rate it a hold.
NextEra Energy (NEE)
Admittedly, NextEra Energy (NYSE:NEE) presents some risks when it comes to stocks to buy this week. Because of Russia’s invasion of Ukraine and Moscow blackmailing Europe with energy outflow cuts, the hydrocarbon industry garnered tremendous relevance. Further, it may take many more years before clean and renewable energy infrastructures represent an everyday reality for most Americans.
Still, the process of mitigating overexposure to hydrocarbons must start somewhere. And really, what better time than now? Although Ukraine appears to be on the verge of pushing Russia further away from its territory, a resolution to this conflict doesn’t appear imminent. Even if peace talks materialize, it’s unlikely that Europe will welcome Russia back with open arms.
After this horrible injustice, it might be politically anathema for world leaders to simply ignore Russia’s military belligerence. Therefore, the global pivot to renewable infrastructures will likely continue onward, peace or no peace. Generally, this narrative should support the bullish case for NEE stock.
Stocks to Buy This Week: Murphy USA (MUSA)
It’s probably no stretch to assume that Murphy USA (NYSE:MUSA) might not be the most popular consumer brand. To be fair, Murphy USA provides low-cost gasoline to consumers relative to other downstream players. Still, it benefitted handsomely from the energy crisis of this year. Look, the chart doesn’t lie: MUSA stock gained 47% YTD as of this writing.
Recently, though, broader macroeconomic dynamics blunted MUSA’s progress. In the trailing month, for example, shares gained less than 4%. In the trailing five days, MUSA lost nearly 5% of its equity value. Fundamentally, though, this red ink may represent a buy-the-dip opportunity; hence, its inclusion on this list of stocks to buy this week.
Primarily, I anticipate a path toward full normalization of the workforce. High-profile companies like Twitter recently demanded their workers return to the office. Also, a weakening economy will likely cause remote workers to lose their leverage. Cynically, this translates to higher commute volumes, which cynically bodes well for Murphy USA.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.