The first quarter of this year was a wild one for the stock market. The S & P 500 Stock Index lost about 4%, and the Dow Jones Industrial Average fell about 3.25%. In late January the two indices set all-time highs. The culprit: the Iran war – sending gasoline prices up about 30%, pointing to higher inflation and possibly higher interest rates, not lower as had been predicted pre-war. The uncertainty regarding the conflict’s duration is causing volatility not seen recently. But, the economy continues to chug along and unemployment remains relatively low – for now.
What to do now? We have been suggesting that investors keep a higher-than-normal cash balance to take advantage of lower prices, and now there are opportunities. The hot technology sector has cooled dramatically, and thus some value is showing up in some stocks e.g., Salesforce (CRM, $182), Microsoft (MSFT, $365), and IBM (IBM, $242). These stocks are approaching the valuations of the average stock, yet these companies are not “average,” having growth expectations well above average. Defense stocks have done well but some are down 10% from their highs, e.g., RTX (RTX, $194) and look attractive based on the increased defense spending here and around the world. Some of the banks, while off their lows set last year, look attractive based on their yield e.g. Truist (TFC, $46, 4.50% yield) and/or their price to book (break-up value) ratio e.g. Citigroup (C, $112, 2.1% yield), and Columbia Bank (COLB, $27.25, 5.25% yield.)
Please contact one of our friendly advisors for a free portfolio check-up or more information about the above stocks. Our portfolio management service continues to expand. Contact Bob Mann for more information.
Prices and yields as of April 2, 2026. The above information is believed to be reliable but is not guaranteed to be accurate. Investors should check every investment for suitability for his or her needs. Stock investing is risky, and you could lose money. The author and/or his clients maintain positions in all of the above-mentioned securities. First Georgetown Securities, Inc. will provide available information supporting the above recommendations on request.