Oppenheimer logo banner header

Where We Stand

John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, explains his top-down view of markets, the economy and asset allocation.

Keys to Allocation

Sector Views

  1. Technology

    Rating: Outperform

    Rationale: Makers of products vital to business and consumers are poised to navigate higher interest rates. Newer technologies to benefit from M&A as established companies seek cost-effective synergies.

  2. Financials

    Rating: Outperform

    Rationale: Prospects for higher interest rates and growing demand for insurance and investment products support sector.

  3. Health Care

    Rating: Perform

    Rationale: Longer-term fundamentals remain solid for pharma with valuations in biotech becoming more attractive for M&A.

  4. Consumer Discretionary

    Rating: Outperform

    Rationale: Leisure, hospitality, travel and back to office poised to support sector. Valuations create prospects for M&A.

  5. Industrials

    Rating: Outperform

    Rationale: Aerospace, manufacturing and construction likely to drive demand for industrial products. Defense spending likely to rise with mounting geopolitical tensions.

  6. Consumer Staples

    Rating: Perform

    Rationale: This defensive sector remains attractive given near-term economic uncertainty. Although valuations remain rich, opportunities may arise on market downdrafts.

  7. Energy

    Rating: Perform

    Rationale: Rising demand while production is hampered is likely to persist through the second half of 2022.

  8. Utilities

    Rating: Underperform

    Rationale: Attractive yields offset by sector’s role as bond proxy as interest rates normalize.

  9. Real Estate

    Rating: Perform

    Rationale: Commercial real estate in hightax urban areas remains a drag while low tax, suburban communities benefit from demographic influx.

  10. Materials

    Rating: Perform

    Rationale: Sector is likely to continue to benefit as domestic and global growth regains traction.

  11. Communications

    Rating: Perform

    Rationale: Exposure to tech-driven segments (5G, media, advertising streaming) provide longer-term opportunity.