Bucking the trend

Clorox, Kroger among stocks not mauled by bear market

LOS ANGELES — Wall Street’s plunge into a bear market after a nearly 11-year bull market has been fast and severe, erasing nearly all the S&P 500’s gains since Donald Trump’s inauguration.

The economic disruptions from the coronavirus pandemic and a steep drop in oil prices have many economists forecasting a global recession as early as next month.

On average, it takes about 40 weeks for markets to recover their losses after entering a bear market, according to Ned Davis Research. But when there’s also a recession the average is 74 weeks.

Yet even in the throes of a bear market there are companies that buck the downward trend, and sectors that tend to perform better by comparison.

Since 1945, the consumer staples, health care and utilities sectors have fared the best during bear markets, on average, according to data from CFRA. Worst off have been the industrials, consumer discretionary and technology sectors.

The consumer staples sector includes makers of household goods, such as packaged food and cleaning products like bleach. It also covers supermarket operators, drug stores and other retailers — all companies that have benefited from surging sales as Americans stocked up before bunkering in their homes to help prevent the spread of the coronavirus.

Shares in Campbell Soup, which had been on a years-long decline, are up nearly 12% this month, while Spam maker Hormel Foods is up 16%. Supermarket chain Kroger is up about 21% this month. Walmart has gained 13.8% and Walgreens Boots Alliance is up 15.4%.

Households’ focus on deep cleaning to ward off the virus has also given shares in Clorox a boost. They’re up about 20% this month.