4 Low-Beta Defensive Stocks to Buy as Rate Cut Uncertainty Continues

Core Viewpoint - The Federal Reserve is maintaining a cautious stance regarding interest rate cuts due to concerns over inflationary pressures from tariffs imposed by President Trump, leading to uncertainty in the market [1][5][6]. Federal Reserve Meeting Insights - The minutes from the latest Federal Reserve meeting indicate that most officials are not in a hurry to implement an immediate rate cut, suggesting a wait-and-see approach [2][5]. - A delay in rate cuts could lead to increased volatility in the stock market [2][7]. - Most participants believe that any inflationary impact from tariffs will be temporary or modest, and there is no urgency for rate cuts in the near term [6]. Investment Recommendations - Given the current uncertainty, it is advisable to invest in defensive stocks from the utility and consumer staples sectors, which are considered safe havens [3][11]. - Recommended stocks include: - Atmos Energy Corporation (ATO): Expected earnings growth rate of 6%, Zacks Rank 2, beta of 0.70, and a dividend yield of 2.27% [9]. - Fortis, Inc. (FTS): Expected earnings growth rate of 3.8%, Zacks Rank 2, beta of 0.48, and a dividend yield of 3.81% [13]. - Colgate-Palmolive Company (CL): Expected earnings growth rate of 1.7%, Zacks Rank 2, beta of 0.37, and a dividend yield of 2.27% [15]. - The Coca-Cola Company (KO): Expected earnings growth rate of 3.1%, Zacks Rank 2, beta of 0.45, and a dividend yield of 2.94% [17]. Stock Characteristics - The recommended stocks are characterized by low beta (greater than 0 but less than 1), high dividend yields, and favorable Zacks Ranks, making them attractive in the current market environment [4][11].