Russian Invasion Fallout: Danger and Opportunity

Just when central banks were turning their attention to fighting inflation, the fog of war has descended on global stock markets.

The invasion of a major wheat producer by a country with allegedly the world’s second most powerful military is plenty disruptive on its own. But so far as investment returns are concerned, the unprecedented and still escalating global sanctions on Russia are by far the main event. And with the ground shifting rapidly, it’s critical to be sure what we’re standing on is still solid.

The good news: The vast majority of essential service stocks in the Conrad’s Utility Investor coverage universe—and particularly in our model portfolios—are holding their own.

As my graph shows, the Dow Jones Utility Average is actually still in the black so far in 2022. That’s even as the S&P 500 has dropped almost -12 percent, and the technology-heavy Nasdaq 100 is in bear market territory down nearly -20 percent.