Recession is coming! So why am I still buying FTSE 100 shares?

first_img I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. “This Stock Could Be Like Buying Amazon in 1997” I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Our 6 ‘Best Buys Now’ Shares Enter Your Email Address Simply click below to discover how you can take advantage of this. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Harvey Jones has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img Image source: Getty Images Recession is coming! So why am I still buying FTSE 100 shares? Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. See all posts by Harvey Jones Harvey Jones | Monday, 1st June, 2020 We are heading for the sharpest recession on record, with the economy set to shrink 14% this year. The Bank of England has warned Covid-19 is “dramatically reducing jobs and incomes in the UK,” and the FTSE 100 has taken a massive hit too.So how come equities have recovered so quickly from the stock market crash in March? The main reason is that central bankers around the world have effectively ‘backstopped’ share prices, through unprecedented fiscal and monetary stimulus. Largely thanks to their efforts, the FTSE 100 has climbed more than 20% since dipping below 5,000.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…The FTSE 100 is holding firmThe bloodbath’s been averted. Investors can breathe a sigh of relief, but they’ll also be wary. They know we haven’t felt the full force of the downturn yet. Government furlough schemes are hiding the fact that many people will not have a job this autumn. Unemployment is set to rise sharply.Companies will continue to struggle after the lockdown is over as nervous consumers are likely to be more cautious. Revenue and earnings will fall. More FTSE 100 dividends could be cut. All this will weigh on stock markets.There’s also the danger of a second wave of the pandemic when winter comes. Another lockdown would be a serious blow to the economy. The government will have to balance the threat to health against the economic damage, while anger mounts on both sides of the political divide.Another stock market crash is possibleThe uncertainty is likely to drag on until we can finally get a vaccine. So who would buy FTSE 100 shares given today’s worries?I would. Although I’d do it carefully. I don’t have the courage go hunting for FTSE 100 bargains in bombed-out sectors, such as airlines and cruises, right now. That trade might pay off, but I’m unwilling to take on that level of risk.Instead, I’d focus on top FTSE 100 companies with healthy balance sheets, loyal customers, strong cash flows, and affordable debt levels. These are best placed to survive an extended downturn, and even take advantage by snapping up struggling rivals.Stocks can survive the recessionRight now, there are plenty of FTSE 100 companies that fit this profile. Today can still be a good time to go shopping for shares, if you do it selectively. You should aim to hold for the long term, allowing time for current uncertainty to pass.But you don’t have to rush out and buy them. Plenty of people are building up a cash position, ready to take advantage if we do get a second stock market crash.However, I wouldn’t leave money in cash for an extended period. Over the longer run, its real value will be eroded by today’s low interest rates. When you see a FTSE 100 stock you like at a decent price, I’d buy it.As stimulus kicks in, share prices could rise sharply, even in a recession. While you should be wary of another crash, you don’t want to miss the stock market recovery either.last_img

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