UK's Largest Bank HSBC Names 11 Stocks with Buy Rating
The consortium highlighted stocks that may be of interest following a sharp decline in US equity market valuations
HSBC has identified 11 stocks with a Buy rating that, in the bank's view, may be attractive following a sharp decline in valuations. The list includes Alphabet, Applied Materials, Baker Hughes, Bloom Energy, Citigroup, Freeport-McMoRan, GE Vernova, NextEra Energy, Oracle, Sempra, and Vertiv.
HSBC strategist Nicole Inui noted that the S&P 500 index has been trading within a limited range for several months, though a notable rotation has occurred within the market. Over the past three months, technology and industrial stocks have fallen by 8–9% amid waning interest in companies linked to artificial intelligence. Some subsectors have declined by nearly 20% from their peaks, despite solid fundamental performance.
Inui assessed that the correction in oversold segments, including semiconductor manufacturers and capital equipment producers, may have been particularly excessive. Meanwhile, stocks in defensive sectors such as consumer staples and healthcare are trading near year-highs and at a premium to the broader market, close to five-year highs.
A significant portion of the companies selected by HSBC is tied to growing demand for electricity and data center infrastructure. The bank highlighted Bloom Energy’s technologies for local energy supply, GE Vernova’s large order backlog, and Vertiv’s equipment for powering and cooling data centers.
Additionally, HSBC pointed to Alphabet’s potential for monetizing AI in search and cloud services, Applied Materials’ presence in advanced chip and memory segments, Citigroup’s profitability recovery, and Freeport-McMoRan’s dependence on copper and gold prices.
