Markets

P&G and these other Dow stocks go down the least when the market is in the grips of a sell-off

Key Points
  • CNBC found that stocks such as Procter & Gamble and McDonald's held up the best when the Cboe Volatility index – the market's fear gauge – jumped five points in five days.
  • Walmart, Coca-Cola and Johnson & Johnson also fell less than the broader market, with an average decline of about 2.2 percent or less, according to Kensho.
  • The Dow fell 665 points, or 2.5 percent, as Treasury yields jumped to multi-year highs.
These are stock market safe havens during a sell-off
VIDEO0:5400:54
These are stock market safe havens during a sell-off

During periods of broad market decline and rising volatility, some consumer companies in the Dow Jones industrial average can be safety plays, according to CNBC analysis using Kensho.

CNBC found that stocks such as Procter & Gamble and McDonald's held up the best when the Cboe Volatility index (VIX) — the market's fear gauge — jumped five points in five days. The VIX has climbed about six points so far this week to 17.31 on Friday.

On 59 occasions since January 2008 when the VIX rose five points in five trading days, Procter & Gamble fell an average of 1.7 percent during that time and McDonald's lost about 1.9 percent, the Kensho study showed. In contrast, the on average dropped 4.3 percent.

Walmart, Coca-Cola and Johnson & Johnson also fell less than the broader market during periods of volatility spikes. The stocks had an average decline of about 2.2 percent or less, according to Kensho.

These better-performing Dow stocks are mostly in the category of consumer staples, a group of stocks of companies that sell daily essentials.

Walmart was one of two Dow components trading higher Friday. McDonald's, Johnson & Johnson, Coca-Cola and Procter & Gamble all traded lower by roughly 1 percent or less midday Friday.

The Dow fell 665.75 points, or 2.5 percent, as Treasury yields jumped to multi-year highs. Chevron, Exxon Mobil and Visa dropped sharply after reporting earnings and were among the biggest contributors of losses in the Dow.

With Friday's declines, the Dow posted a weekly loss of 4.1 percent.

"Strap in, it's going to be a volatile year," said Dan Veru, chief investment officer at Palisade Capital Management. "I don't think we're going to have [a] grind-up year."

— CNBC's John Melloy contributed to this report.

Disclosure: CNBC's parent NBCUniversal is a minority investor in Kensho.