The global, European and, of course, Spanish recession enters fully into the panorama of companies that are listed on the equity markets. To the point that the predictions speak of an unprecedented crisis in international economies. Overcoming the effects that were generated in the crash of 29 and also in the economic crisis of 2008. With a virulence that is more similar to a war scenario than to other episodes of a financial nature to which we were more accustomed until now, as indicated by the main economic indicators in the second quarter of this year.
In any case, it should be noted that in situations of downtrend in the equity markets, the most sensible thing to do is to hold the investment until better prices are achieved in its quotation or until signals appear that indicate the end of this. Although you run the risk of falling into extraordinary situations that can make a value fall significantly with the consequent losses in your income statement. It tends to wait until the price of the shares provide lower and adjusted prices so that they are interesting to make purchases from now on. Something that at the moment cannot be ratified, although it falls within the most probable.
Therefore, it is prudent to choose a formula that combines the safety and risk equation as a strategy to preserve the amounts contributed, especially in those bearish periods. Where it is easier than small capital gains obtained become in a few stock market sessions in red numbers for the investor, with the dilemma then of whether to sell with a handicap or to go even deeper into them. To help small and medium investors make decisions, we are going to show and analyze which are the most favorable sectors to take positions in these complex times for equity markets, both nationally and abroad.
Most bullish sectors: technology
It is being in a way the lifeline for the interests of small and medium investors. By going against the current of the evolution of the more conventional or traditional stock indices. A clear example of this trend is represented by the selective index of technology companies in the United States, the Nasdaq. It has maintained the upward trend during this difficult year, albeit only slightly, with an annual appreciation of around 2%. With companies that present an increase in their prices in the double digits when representing at the moment, not the future, but clearly the present for investors. In different segments, such as entertainment content, software and others with similar characteristics.
While on the other hand, it cannot be forgotten that these stock market values benefit greatly from the expectations that have been created in them at this precise moment. With a Greater demand with respect to other more usual periods and that can pull the financial markets above other proposals on the stock market. To the point that they are making up a large part of the investment portfolios promoted by different financial intermediaries that see in these securities the real business opportunities to make their savings profitable at the current juncture. With a potential for revaluation that can be very interesting from now on.
Values of the pharmaceutical sector
They are undoubtedly the big stars of the equity markets due to the large revaluations they have experienced in these trading days. With capital gains above 10% In most cases, and to where a good part of the monetary flows that seek havens have been directed to weather this harsh scenario that occurs in the financial markets, at least in the short term. Where many of these companies are involved in performing treatments and vaccines for the coronavirus and therefore create strong expectations among small and medium investors in these difficult trading days for all users. On the other hand, we cannot at this time that these values are the most likely to grow in financial markets at this precise moment.
The values of the pharmaceutical sector, on the other hand, are characterized in other periods by their great volatility when forming their prices. But that in the current circumstances they have made this problem a virtue that can be taken advantage of by small and medium investors who have taken positions at the beginning of this economic crisis caused by the expansion of the coronavirus all over the world. And that in many cases, their companies have revalued averages at levels close to 15%, a level that contrasts with the large losses that have been generated from other stock values, both in national markets and outside our borders. As it is a clearly expanding sector these days as a good part of the funds are collected by investors from all performance profiles.
There are always the electrics
When referring to defensive or conservative stocks, it can never be forgotten that electric stocks are always there to take positions in these very complex conditions for equity markets around the world. They are par excellence the most traditional refuge values and have a better performance than the rest in negative scenarios, as in the current case. While on the other hand, we cannot forget that they have been the only stock market sector that has maintained unchanged its dividends that are going to be distributed among its shareholders. With an average, fixed and guaranteed profitability that reaches 6%, and that may be the reason for the purchases of small and medium investors. Although by no means their rises were spectacular, without reaching daily rises above 3%, with rare exceptions.
Another aspect to consider in the values of the electricity sector is that they offer a recurring line of business because homes and companies need their service. In this sense, it suffers little and may be an incentive to include them in the next review of our investment portfolio. To protect investments more effectively in a period as difficult as it is at the moment that we are going through with the development of this virus in the respiratory tract that has paralyzed the economy of the whole world. Therefore, we cannot fail to include these listed companies at the time of making a decision on which securities we should contract in the equity markets. Despite its tremendous fall in the month of April and that has led, for example, to Endesa from 26 to 15 euros for each share.
Another refuge: food
Interestingly, within the selective index of equities in our country, the Ibex 35, the only value that maintains a clearly upward trend is Viscofan. To the point that in this period it has revalued by just over 10%, monopolizing a large part of the purchases made by small and medium-sized investors in these difficult moments for everyone. Not surprisingly, it is integrated into another of the favored sectors in these weeks by increasing its sales among the population that need its products to pass confinement. From this point of view, it is a very favorable option to protect our interests in the always complicated world of money, and more so in these exceptional days in which we live. That is to say, they are more of a buy than a sell and therefore they are within our radar without too many complications in their development.
On the other hand, this sector in the stock market is characterized these days by leading the increases in the most complicated trading days. To the point that they have generated a positive balance since the end of March, and in any case, above the other sectors that are included in the main indices in the equity markets. With a volume of recruitment that has increased significantly in recent weeks. Although, for example, in the Ibex 35, only the Viscofan company is present as a value of these characteristics. Although the revaluation in these days of the Dia supermarket chain is also striking and has attracted the interest of a very defined profile on the part of small and medium investors.
While finally, we must emphasize that we must bear in mind that one of the consequences that we must have of the crash that has occurred in the markets around the world is that from this moment we must be more selective in the purchases of stocks in equity markets. And the sectors that we have exposed can be an example of this trend that we are targeting. In all of them, there are real possibilities so that savings can be made profitable from different kinds of investment strategies.