Markets Eye Inflation Data and Bank Earnings; 2024 Outlook Optimistic for Steady Growth
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Inflation reports coming out this week could move markets if the numbers diverge significantly from expectations. Banks are also reporting Q4 earnings, with Citi and Wells Fargo looking undervalued.
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2024 outlook expects a "return to normal" as pandemic disruptions fade, with slower but more steady economic growth and stock returns. Small caps and value stocks still look undervalued.
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Communications sector remains undervalued, especially Alphabet and telecoms like Verizon, while tech has become overvalued after a huge 2023 rally. Materials, utilities, energy, and real estate also look discounted.
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Portfolios should be at target allocations. Overweight value, small caps, communications, materials, utilities, energy, real estate. Underweight tech, industrials, consumer cyclicals.
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Stock picks WK Kellogg, Zimmer Biomet, Federal Realty Investment Trust, WEC Energy, and Newmont Mining. All undervalued with upside potential.