Nomura now expects the Fed to raise interest rates by 75 points in June and July

Nomura now expects the Fed to raise interest rates by 75 points in June and July - here are 3 stocks to protect your assets this summer.

Nomura now expects the Fed to raise interest rates by 75 points in June and July – here are 3 stocks to protect your assets this summer.

The Federal Reserve has expressed a desire to calm inflation. But Nomura hopes the Fed will be even more horrified than letting them down.

In an update last month, Global Investment Bank said it was seeing faster rates than previously expected. They are now calling for an increase of 75 basis points in June and July. On May 4, Fed officials raised interest rates by 0.5%.

“Our US team has changed their Fed call,” Rob Subbaraman, head of global market research at Nomura, wrote in an email. “They now expect the FOMC to be more forward-loaded with the rate hike, so that the rate of funding can be restored as quickly as possible to avoid a wage-price spiral.”

Here are three stocks that can help you protect your portfolio in a fast-growing rate environment.

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Bank of America (BAC)

Bank of America is a $ 280 billion financial holding company, with a leading U.S. and global footprint.

Generally speaking, the rise in interest rates has positively affected the banking business. When rates rise, banks spread out what interest they charge and what they pay.

Bank of America has a higher proportion of its assets in low-cost consumer deposits than its peers. In other words, rising interest rates will benefit Bank of America more than many of its competitors. Conservative underwriting and a measured risk appetite will also help the bank to take advantage of its scale and opportunities in a responsible way.

The bank is enjoying a resilient consumer and strong credit market. In the last few quarters, earnings have come in better than expected.

Bank of America shares are still down 25% in 2022 Rapidly increasing rates can act as a powerful turnaround catalyst

Mark (MRK)

Healthcare agencies can also act as a safe haven in an increasing rate environment. Their resilient nature makes them relatively resistant to economic turmoil which can bring high rates.

After all, the healthcare sector has not grown much in recent years, so assessment is mandatory.

The healthcare giant Mark – a $ 230 billion global healthcare organization – presents a difficult way to gain access to this sector. It has leading oncology and cardiovascular disease franchises.

2021 was a strong year for Mark. Due to strong operating momentum it has increased revenue and EPS by 17% and 7.3% respectively. Currently, the stock is offering a dividend yield of 3%.

Chenia Energy (LNG)

Cheniere Energy is the leading producer and exporter of liquefied natural gas in the United States. Thanks to white-hot inflation, the company is benefiting from rising natural gas prices. Since interest rates are linked to rising energy prices, China looks like a particularly timely opportunity.

Cheniere is also enjoying a very favorable global supply / demand dynamic, showing no signs of giving up. In March, US LNG exports rose 16% to record highs as European countries sought to reduce Russian gas imports.

Record global LNG demand as a result of record revenue, volume and cash flow for the chain. Shares rose an impressive 28% in 2022.

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