The Zacks Analyst Blog Highlights: CrossAmerica Partners, Arbor Realty Trust, Prospect Capital, Plymouth Industrial REIT And Global Net Lease
Zacks Investment Research | Dec 25, 2018 09:25PM ET
For Immediate Release
Chicago, IL – December 26, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: CrossAmerica Partners LP (NYSE:CAPL) , Arbor Realty Trust Inc. (NYSE:ABR) , Prospect Capital Corp. (NASDAQ:PSEC) , Plymouth Industrial REIT Inc. (NYSE:PLYM) and Global Net Lease Inc. (NYSE:GNL) .
Here are highlights from Monday’s Analyst Blog:
Buy 5 High-Yielding Stocks to Counter Stock Market Slide
Wall Street is likely to witness its worst ever December since the Great Depression of 1931. The recent market skepticism regarding the future growth potential of U.S. stocks have been fueled by a plethora of factors – the recent rate hike and Fed’s tight monetary policy, fear of partial government shutdown, conflicting news related to trade war between the United States and China and concerns of a global economic slowdown.
At this juncture, investment in high-dividend paying stocks, over a reasonable time period, is likely to bring good returns, especially when the market is plagued with severe volatility. Consequently, it would be a prudent investment decision to bank on stocks with a favorable Zacks Rank promising strong dividend yield in a bid to capitalize on future growth.
Fed’s Tight Monetary Stance
On Dec 19, the Fed raised benchmark lending target rate by 0.25% to the range of 2.25-2.50%. This was the fourth rate hike by the central bank in 2018. Investors are now concerned regarding two more rate hikes in 2019 and continuation of Quantitative Tightening through which the central bank is reducing the size of its balance sheet by $50 billion each month by redeeming government debts and mortgage bonds.
This implies that a massive $600 billion will not be invested in sovereign bonds in 2019. This will significantly reduce demand for U.S. government bonds, resulting in lower bond price and higher yields. Consequently, interest rate will go up in the long term.
Concerns Over Partial Government Shutdown
On Dec 21, President Donald Trump tweeted that if the U.S. Congress does not approve $5 billion or more for the construction of a wall or “steel slats” at the United States – Mexico border, then it is likely to escalate to long-term partial shutdown of the U.S. government.
Notably, on Dec 18, Senate Majority Lead Mitch McConnell said that a proposed short-term government funding plan worth $5 billion border security fencing was rejected by Democrat representatives. Notably, Trump needs Democrat support in Senate to pass the bill.
Consequently, partial government shutdown commenced since mid-night Dec 21. With both President Trump and Democrats resolutely standing their ground, remain resolutely opposed, the ongoing shutdown is likely to persist.
Conflicting News on US-China Trade War
On Dec 21, Peter Navarro, President Trump's trade adviser said that it is highly unlikely that the United States and China will arrive at a permanent economic agreement during the 90-day ceasefire period agreed by both sides.
However, on Dec 19, Treasury Secretary Steven Mnuchin said that the United States and China will meet in January 2019 to seek an amicable solution to its long running trade war. Munchin further added, the two sides are engaged in telephonic conversation and a face-to-face meeting is around the corner. Chinese officials also confirmed Munchin’s statement.
Our Top Picks
At this juncture, it will be lucrative to invest in high-yielding stocks in order to ensure a steady income stream. We narrowed down our search to five such stocks with a Zacks Rank #1 (Strong Buy) and high-dividend yield. You can seeZacks Investment Research
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