A hot inflation report rattled Wall Street and diminished hopes for the number of rate cuts likely this year, but there are still areas in the market where investors can hide out if price pressures keep reaccelerating. Stocks sold off Wednesday, with the Dow Jones Industrial Average tanking as much as 500 points at one point after March inflation data came in above economist forecasts. The 10-year Treasury yield, a benchmark for mortgage loans and credit card debt, soared back above 4.5%. To guard against stubborn inflation and higher-for-longer interest rates, investors should focus on quality companies with high pricing power and adjust their duration risk in bonds, according to Wall Street strategists and portfolio managers. Duration refers to a bond’s sensitivity to interest rate moves, and usually centers on short- vs. medium- vs. long-term maturities. Pricing power Companies with high pricing power tend to outperform when inflation is elevated because they have the ability to defend their profit margins by passing along higher costs to their end market customers. “In equities, you should prefer companies that have pricing power, i.e. largely mega cap technology,” Brad Conger, chief investment officer at Hirtle, Callaghan & Co., an asset manager overseeing more than $18 billion, said in an email. Such companies, including those usually called Big Tech, often have high profit margins and are expected to generate stable sales growth despite sticky inflation. Short-duration bonds Bills, notes and bonds with shorter-dated maturities could become a safer alternative when rates are rising, as their value holds up better than longer-dated bonds in a period when inflation sometimes flares up and the Fed is keeping rates where they are to fight higher prices. “If markets are worried about inflation being persistent, bond yields are likely to move higher. In which case being short duration (or cash) is a good place to hide out,” said Sonu Varghese, global macro strategist at Carson Group. The two-year Treasury yield, the most sensitive to monetary policy, jumped 20 basis points to 4.95% Wednesday following the March inflation report. TIPs & more A direct hedge against inflation in the fixed-income market is Treasury Inflation-Protected Securities. The principal portion of these securities rises and falls alongside the movement in the consumer price index, offsetting the effects of inflation. Issued by the U.S. government, investors can buy TIPS at five-, 10- or 30-year terms, with twice-annual payments based on the assets’ value, which adjusts every six months along with inflation. Investors could also consider so-called go-anywhere fixed-income strategies, which have the latitude to actively alter duration exposure and step into yield opportunities in volatile markets, said Jason Pride, chief of investment strategy and research at Glenmede Trust, an asset manager overseeing $44 billion. “When inflation is the predominant risk in markets, correlations between stocks and traditional bonds tend to be high. As a result, the typical diversification benefits offered by broad bond exposure may be less than advertised,” Pride said in an email. Among recently introduced, actively managed bond ETFs are BlackRock Flexible Income ETF (BINC) , whose managers include BlackRock’s Rick Rieder, chief investment officer of global fixed income. BlackRock’s iShares strategy team recently argued that investors should take advantage of spikes in bond yields while they can and reinvest their cash.
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Time is the most valuable thing any of us has. Therefore, why not keep track of it in the most accurate and stylish way possible, relishing every second? Amazon can help you do that with its incredible selection of high-end watches. One of them, from Citizen, is currently available for half off, and we think it ticks all the boxes.
The Citizen Calandrier Eco-Drive Watch is on sale for $260 right now, which is 50% off the regular price of $525. Not only does this watch give you the time, but it even tells you the day and the date.
Citizen Calandrier Eco-Drive Watch, $260 (was $625) at Amazon
While a watch that tells the time is useful, one that does that and lets you know exactly what day and date it is can keep you on schedule better than you might imagine. In addition to the time, day, and date functions, this watch has a 24-hour tracker and world time function, so you can know what time it is anywhere in the world.
With a stainless steel case and bracelet, the timepiece oozes elegance and durability. Its blue dial is highly legible and attractive, and is sure to get you plenty of compliments. It also has a scratch-resistant mineral crystal and 100 meters of water resistance. The Japan-made quartz movement inside operates off of solar energy, provided by the Eco-Drive technology within.
Amazon customers raved about this watch. One called it “my favorite watch,” adding, “I fell in love with how it looked…It feels and looks like a very high-quality watch. All the functions work perfectly and are not hard to read.”
Another touted the “beautiful blue dial,” and said, “I love good-looking watches…but if the design can incorporate useful functions as well, it’s a winner for me. And this watch does all of that.”
The Citizen Calandrier Eco-Drive Watch will let you know exactly when you are, and it can do so in style. It can also do so for only $260 at the moment, so why not take a chance? We would never waste your time if it weren’t worth it.
Check out the companies making headlines in premarket trading. Oil stocks — Energy stocks climbed in premarket trading amid a jump in oil prices after Israel launched airstrikes against Iran without U.S. support, drawing concerns over the supply outlook from the oil-rich Persian Gulf. Chevron and Exxon Mobil rallied about 3% each, while ConocoPhillips jumped more than 4%. EOG Resources gained more than 3%. Gold stocks — Stocks tied to gold advanced as investors flocked to the perceived safe haven amid the geopolitical escalation. Newmont and SSR Mining both rose more than 1%, as did the VanEck Gold Miners ETF (GDX) . Defense stocks — Weapons manufacturers rose amid elevated geopolitical risk following Israel’s attack on Iran. RTX and Northrop Grumman both surged more than 4%, Lockheed Martin gained 3.5% and L3Harris Technologies added 2.2%. Cruise lines and airlines — Travel companies slid as investors worried that heightened risk would deter vacationers and spikes in oil prices would hurt profit. Carnival fell more than 4%, Norwegian Cruise Line and Royal Caribbean Cruises dropped more than 3% each. United Airlines weakened more than 5% while Delta Air Lines and American Airlines each declined more than 4%. Southwest Airlines shed more than 2%. Hotel stocks — Hotel and resort stocks declined as traders weighed the outlook for diminished travel demand following Israel’s strike on Iran. Hilton Worldwide and InterContinental Hotels Group slipped more than 2% apiece, while Marriott pulled back nearly 2%. RH — The home furnishings retailer jumped 19% after posting a surprise adjusted profit in its fiscal first-quarter. RH earned an adjusted 13 cents per share, while analysts surveyed by LSEG expected a loss of 9 cents per share. Net income of $8 million reversed a year-earlier loss of $3.6 million, but revenue trailed Street estimates. RH shares were down more than 50% year to date ahead of the report. DraftKings — Shares of the sports betting app lost nearly 3% after imposing a 50-cent transaction fee in Illinois starting in September after state lawmakers passed a budget including what one analyst described as a surprise increase in an online gambling tax . Adobe — Shares fell more than 3% after the graphic design software company posted better-than-expected second-quarter earnings. StreetAccount cited concern over a “slight deceleration in Subscription and cRPO growth rates [and] implied Q4 growth outlook.” In the latest quarter, Adobe earned an adjusted $5.06 per share on $5.87 billion in revenue, above the $4.96 per share and $5.79 billion in revenue analysts surveyed by LSEG were expecting. Adobe also lifted its full-year guidance. GE Vernova — The turbine manufacturer slipped nearly 3% on the heels of a downgrade to peer perform from outperform at Wolfe Research. Analyst Nigel Coe cited concern over GE Vernova’s “challenging valuation” after a more than 48% gain for the stock in 2025. — CNBC’s Yun Li, Jesse Pound, Sean Conlon and Brian Evans contributed reporting