Ready to Buy Those Bargain Stocks? Read This First

The indexes have bounced off the early lows but it is a sea of red with nearly four stocks declining for each one that is advancing. New 12-month lows are piling up and at around 700 an hour into the trading day.

There is a little green in "safe" pharmaceuticals and some dividend-paying stocks such as Altria MO and Verizon VZ, but the lack of clarity about tariffs and the economy keeps most of the capital out there parked on the sidelines.

We don’t know what will happen with tariffs yet, but the market is pricing in some pretty drastic bad news. Once we start to learn the exact terms of the tariffs, there actually might be a good "buy the bad news" opportunity. The market is acting like we are heading for a major recession, and it may not be that bad.

We are at the point now where it is too late to aggressively sell, but the price action and technical action are too poor to buy. We have a broken market, and it will take more than a little intraday bounce to fix it.

One group that I was hoping might be a safe harbor from tariffs was biotechnology. However, the resignation of top vaccine official Dr. Peter Marks is causing concern about the approval process for all biotechnology, especially those involved in gene therapy. The FDA is in a state of flux, which creates great uncertainty for the biotech sector.

My game plan here is to do very little while we wait to see what happens with tariffs. Any concrete news at this point will be better than uncertainty.

If you are inclined to buy some of the "bargains" that are developing, my best advice is to move very slowly and buy incrementally. You do not want to move too big, too fast. Just because a stock is a great value doesn’t mean the market is going to appreciate it at this point. Have that shopping list ready, but you don’t have to act on it.

At the time of publication, Rev Shark was long VZ and MO.