Market veteran Nancy Tengler says it’s premature to talk about a new bull market, calling her favorite stocks “credible.” “I think this rally has been excellent,” Tengler, CEO and chief investment officer of Laffer Tengler Investments, told CNBC’s “Squawk Box Asia” last week. She added, “We’ve added to risk in our portfolios since mid-June, and that has worked out very well. But I don’t think we’re out and working in a new bull market.” She referred to recent data indicating that inflation may have peaked, but stressed that there is still “some work to be done” to reduce inflation significantly, which is still high compared to last year. There is also uncertainty surrounding the path of further rate increases, given that the Fed has been “a bit unreliable in sticking with the plan”. “You shouldn’t be chasing that rally because we don’t know if the Fed is going to go 75 [basis points]. “We don’t know if they would make a policy mistake,” Tengler said. She noted a “tug of war” between conflicting data: Prices for commodities, food and energy, for example, have fallen, but rents and other inflation metrics remain high.. “Don’t be a hero” Tengler’s advice to investors? “Don’t be a hero.” It’s shifting its portfolio to include “more reliable growers,” or companies with a track record of growing profits and dividends. “We got rid of some of the rotating names and added them to the defense names last fall…their dividend growth is reliable, and we really tried to stick with reliable dividend payouts,” she said. The stock currently in its portfolio is the Spotify music streaming service. Tengler acknowledged the significant challenges facing its rival Netflix, but believes that companies have different perspectives due to their different business models. “You can keep your music when you leave the house. It’s not home theater. And you can listen to podcasts. They’ve really boosted this part of their business.” Read more To everything in technology? Takes — and reveals what he’s buying “very compelling value”: The analyst picks his biggest global stock to withstand slowing growth and is also bullish on some of the tech’s cloud and cybersecurity names. “We like companies that can offer solid pricing, and in earnings season we’ve seen cloud providers deliver an excellent return on performance,” she said. Microsoft, Amazon, Oracle, and Google parent Alphabet are among the stocks they like.” We’ve also seen that cybersecurity names have turned into excellent returns and will continue to do so. Texas Instruments – Two companies that return the majority of free cash flow to shareholders by increasing dividends and repurchase of shares.
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