Investors should be especially cautious about hard-hit technology stocks. Some experts warn that while the current decline in the U.S. stock market may attract some who want to "buy the dip," now is not the time. In recent days, stocks have been close to lows not seen since mid-J

investors should be especially cautious about hard-hit technology stock . Some experts warn that while the current U.S. stock market decline may attract some who want to "buy the dip," now is not the time. In recent days, the stock market has been close to its lows since mid-June. Since last Friday (August 26), U.S. stocks have fallen for four consecutive days as investors are still digesting Federal Reserve Chairman Chairman Jerome Powell 's speech at the Jackson Hole annual meeting of the central bank, in which he reiterated The Fed reiterated its pledge to raise interest rates to curb inflation, even if it meant causing "some pain" to households and businesses.

The decline in the market has continued from last week to this week. As of press time before the US stock market opens on Thursday (September 1), the three major stock index futures are still in decline. Some investors may view the current decline as an opportunity to buy high-priced stocks. In particular, they may look to technology stocks, which have performed well during the secular bull market and rebounded from their June lows. However, there are some problems with this strategy. Dan Suzuki, deputy chief information officer of Wall Street Richard Bernstein Consultants, wrote in a recent research note: First, the current bear market may still have some way to go. To go, the "get ready for the bottom" strategy has no advantage. What's more, a bear market always heralds a change in the stocks that are leading the market higher. In other words, yesterday's winners won't be tomorrow's winners, so investors shouldn't look for deals in the rearview mirror. takes technology stocks as an example. High-growth technology stocks are particularly vulnerable to rising interest rates. Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management in Florida , said just because a stock is a good deal relative to its past price doesn't mean it will continue to do so. Very cheap in terms of future earnings potential. Take battered chip stock Nvidia (NVDA), which on the surface looks like a good bargain-hunting opportunity, but in fact the company still faces some headwinds. The S&P 500 index is down 17% this year and 4.2% since August

Landsberg said defensive sectors such as health care, utilities and consumer staples are currently more attractive than technology stocks and consumer discretionary stocks. force. He noted that those who are overweight technology stocks can take this opportunity to trim their allocations. Quincy Krosby, chief global strategist at Virginia-based wealth management firm LPL Financial, said investors who want to make tactical allocations now should prioritize quality. This means focusing on companies with strong cash flows and a proven track record of paying dividends. Additionally, no matter what happens to the broader market, investors can protect themselves by buying higher-quality stocks, which tend to have relatively stable revenue streams, even when economic demand declines. UBS (UBS) strategist Keith Parker said that when recession risks rise, high-quality stocks tend to perform better than lower-quality stocks. The list of stocks listed by Parker focuses on those stocks that are expected to have solid sales growth and UBS analysts expect double-digit share price gains, including among them Coca-Cola (KO), Cigna ( CI) and microsoft (MSFT). Microsoft's sales are expected to grow 13% in fiscal 2023, and UBS has a price target of $330 on the stock, which is 26% higher than current levels. Coca-Cola's sales are expected to grow 3.7% in 2023, and UBS gave the stock a target price of $72, with room for a 15% increase. Cigna's sales are expected to grow 5% in 2023, and UBS gave the stock a target price of $330, with room for upside of 16%. article | "Barron's" writer Elizabeth O'Brien (Elizabeth O'Brien) editor | Tina, Guo Liqun copyright statement: "Barron's" (barronschina) original article, may not be reproduced without permission . For the English version, see the report “Market Timers, Beware: Now Isn’t the Time to Buy the Dip” on September 1, 2022. (The content of this article is for reference only, and the investment advice does not represent the bias of "Barron's"; the market is risky, so investment must be cautious.)