Investors are bracing for more volatility ahead, as they navigate what has traditionally been a period of “seasonal weakness” for stocks. The main US averages closed for a third consecutive negative week last week, weighed down by concerns that the US Federal Reserve will continue to pursue aggressive interest rate hikes to rein in inflation. . Phil Blancato told CNBC’s “Street Signs Asia” on Friday: “With the Federal Reserve’s hawkish comments, uncertainty has returned to the market and the S&P 500 appears to be attempting a retest. some of the lowest levels of the year”. The chairman and CEO of Ladenburg Thalmann Asset Management, which has more than $4 billion in assets under management, said he expects the S&P 500 index to continue to fluctuate “for at least six weeks.” next.” “Historically, volatility tends to increase in September and October, especially in the years leading up to midterm elections. But stocks tend to rebound strongly in the months that follow, turning turn positive soon after, suggesting that patience and investment discipline will likely be key months ahead,” he added. While the next few weeks will see higher market volatility, Blancato believes a “robust rally” in equities is beneficial as valuations improve, the Fed becomes less hawkish and the US is still out of recession. The second week of October is traditionally “the start of the year-end rally”, he said, while inflationary pressures should ease enough for the Fed to reconsider its stance. What to buy on a soak Blancato believes this is a “great opportunity” to buy in a dip, with the “great names” now significantly cheaper than they were a few weeks ago. He favors dividend-paying stocks and companies with good cash flow. “I like volatility. I take advantage of markets like this,” he said. He likes Costco to be “one of the dominant warehouse retailers” with its pricing power and “exceptional” membership business model. He said the company would benefit as consumers favor discount stories amid high inflation, while other positives include an expanding e-commerce presence and dividends. get a raise. He also likes ExxonMobil, which he describes as the “benchmark” for the energy sector. According to Blancato, the oil giant has significantly less debt than its peers. And expanding its share buyback program is boosting shareholder value, he added. Cybersecurity firm CrowdStrike has been shortlisted by Blancato. He expects the company to benefit greatly from “strong growth” in the industry. The company also has a strong balance sheet, he added. Consumer confidence bottoming is a positive sign Consumer confidence bottoming is also a good sign for the market, according to Blancato. In July, the University of Michigan’s Consumer Sentiment Index fell to an all-time low of 51.5 – only the fourth time in history the index fell below 60.” Blancato In the previous three instances when the sentiment index dipped below 60, the stock market traded higher in each of the next six and 12 months, he added. an average of 16% over the next six months and 20.9% over the next 12 months.