Stock Picking in a Range

• S&P 500 expected to remain stuck in a tighter range due to macroeconomic risks even as short-term volatility is Huitong Finance Networklikely to decrease
• In that scenario, stock picking is the best and safest way to score above-average profits in the coming months
• Applied Materials and Accenture could be market winners based on their financial health, undervaluation, and positive market trends

, which is usually positive for markets, too many macroeconomic risks remain in place in order for markets to rally like there's no tomorrow.

in early January, this conundrum suggests that the will most likely remain stuck in a tighter range that we have gotten used to in the last decade. And while recent data have indicated an (expected) improvement both from the inflation and the economic resilience sides, I still see 4,300-4,400 as a very strong resistance for the S&P 500 in the next few months.

and (that is, before the SVB debacle), the joker on the deck is the banking sector, particularly smaller and regional U.S. banks. Despite the situation being perceived as stable by the general market, the lag effect of higher volatility in the bond market could still be a problem once the Fed's Bank Term Funding Program (BTFP) runs out. On the positive side, though, recent indicates that banks borrowing from the BTFP is easing week by week. Still, investors that want to assess the market direction should keep a close eye on the sector's situation.

), semiconductors have rebounded sharply this year, up nearly 25% YTD. There are a few reasons for that, but the main ones are the broad tech resurgence, as investors look favorably to stocks that were unfairly punished during last year's selloff, the reopening of the Chinese economy, and the lowering expectations regarding the depth of a probable global recession later this year.

when selling Taiwan-based Taiwan Semiconductor Manufacturing (NYSE:) last week.

) is an excellent option. The leading provider of manufacturing equipment, services, and software for the semiconductor industry, as well as display and related industries, has several reasons that should propel its stock higher in the mid-term, according to InvestingPro. Such as:

Source: InvestingPro

Source: InvestingPro

Source: InvestingPro

) as the new Tesla (NASDAQ:) (at least not in the short term), the Dublin, Ireland-based professional services and HR company has everything it takes to safely outperform the market for the next few months.

ticks progressively lower, the still resilient U.S. is also a major tailwind for Accenture, keeping demand for the company's services significantly high.

That's the main reason why — contrary to the general U.S. stock market — Accenture is expected to post solid earnings growth when it reports financial results in June. While analysts have reduced the company's earnings expectations by 7% over the last 12 months, ACN's EPS is still expected to come in at 2.98 — significantly higher than last quarter's 2.39.

Source: InvestingPro

Source: InvestingPro

Source: InvestingPro

to hedge volatility risks.

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