3 Sectors to Avoid Under the Trump Administration

Over the past week, I’ve posted a special Presidential series as Donald Trump became the 45th President of the United States.

Last Wednesday, I offered my predictions for 2017 and beyond. On Thursday, I identified four winners of the Trump era, including top stock picks from Blue Chip Growth, Emerging Growth and Dividend Growth.

Today, I’ll discuss the other crucial side of investing: The stocks and sectors that should be sold for now. And what I’m about to say may surprise you.

Be Very Careful with Financial, Industrials and Materials Stocks

In the weeks following Election Day, there were several sectors that rallied strongly, including financials, industrials and materials. However, much of this rally was fueled by short-covering, so it wasn’t sustainable.

So while there was a lot of hype surrounding these sectors, I largely recommend that you avoid these sectors in 2017.

The reason why is simple: All of these sectors are characterized by lackluster or negative earnings and sales growth. In fact, many market bellwethers missed earnings estimates in the latest quarter—and barely 15% of mega-cap stocks have solid fundamentals. And that’s not going away any time soon.

Many multinational companies will continue to struggle to keep their heads above water in the first few quarters of 2017. And that’s because of the strong U.S. dollar. The fact is that the U.S. dollar is at the highest level against the euro in over a decade, and it’s also rising against the British pound and the Japanese yen.

As a result, the U.S. dollar is wreaking havoc on multinationals’ top and bottom lines.

Over the past few weeks, big multinationals in the financial, industrial and material sectors have pulled back, as Wall Street realized these companies didn’t have the fundamentals to support their yearend surge higher…

49 Stocks to Sell Immediately

So my advice to you is to ignore the recent rally in financial, industrial and material stocks. In fact, my Portfolio Grader system has identified 49 stock market giants that you should sell immediately.

Consider the list below. Cross-check with your own portfolio. And if you own any of these losers, sell immediately because they have the potential to blow a hole in your portfolio this year.

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I hope you have enjoyed reading this special three-part series on investing in the Trump era.

As we learn more about what changes are in store at the White House, I will continue offering my guidance through this daily blog, and through my premium newsletters.

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