Goldman Sachs analysts say stock investors should look to larger cap and defensive sectors as a way to play the uncertainty of presidential primary season.
While they say the major party nominees should become clear by "Super Duper Tuesday," there is greater electoral and policy uncertainty in this presidential race because there are no incumbents running. Add to that the rising probability of recession, they say. Super Tuesday is Feb. 5, when 24 states have scheduled primaries.
The note, from strategist David Kostin and other analysts late last week, says the groups to overweight are consumer staples, info technology, health care and energy. They say underweight industrials, utilities, telecom, financials, materials and consumer discretionary.
Among the stocks they like are Pepsi and in health care, WellPoint. In the oil and gas equipment sector, they like Schlumberger. They also list Oracle, Cisco, Wal-Mart, Abbott Labs, and Baxter International as stocks to buy.
Listed as unattractive examples are Merrill Lynch , rated neutral, and packaged food company Wrigley , rated sell.
Speaking of uncertainty, just last week, 80 percent of strategists and economists in a CNBC survey said they thought N.Y. Sen. Hillary Cliinton would be the Democratic candidate for president, and 80 percent said they believe Democrats will win the White House.
That survey was taken just before Illinois Sen. Barak Obama's victory in Iowa's caucuses Thursday and strong momentum going into tomorrow's New Hampshire primary. It will be interesting to see if those expectations change.
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