Top US Cyclical Stocks to Watch in 2023

In the ever-evolving landscape of the stock market, cyclical stocks have always been a cornerstone for investors looking to capitalize on economic upturns. These stocks tend to perform well during periods of economic growth and contraction, making them a dynamic and potentially lucrative investment choice. As we delve into 2023, let's explore the top US cyclical stocks that investors should consider adding to their portfolios.

Automotive Industry: Tesla (TSLA) and Ford (F)

The automotive industry is a prime example of cyclical stocks, as consumer demand for vehicles often spikes during economic booms. Tesla, the electric vehicle (EV) pioneer, has been at the forefront of this transformation. With its groundbreaking technology and growing market share, Tesla (TSLA) remains a top pick for cyclical investors. Ford (F), on the other hand, has been transitioning its lineup to include more electric models, positioning itself for growth in the coming years.

Energy Sector: Exxon Mobil (XOM) and Chevron (CVX)

As the global economy continues to recover, the energy sector is poised to benefit significantly. Exxon Mobil (XOM), one of the largest oil and gas companies in the world, has been making strategic investments in renewable energy, while still maintaining a robust presence in traditional fossil fuels. Chevron (CVX), another industry giant, is also investing in renewable energy and has a strong portfolio of oil and gas assets.

Technology: Apple (AAPL) and Microsoft (MSFT)

While technology stocks are often considered defensive, some tech giants have cyclical elements to their business models. Apple (AAPL), the world's most valuable company, has seen its revenue soar during economic expansions, driven by strong consumer demand for its smartphones, tablets, and other devices. Microsoft (MSFT), known for its Office suite and cloud computing services, has also seen significant growth during economic upswings.

Retail: Walmart (WMT) and Target (TGT)

The retail industry is another cyclical sector that tends to thrive during economic booms. Walmart (WMT), the largest retailer in the world, has been expanding its online presence and investing in technology to enhance customer experience. Target (TGT), while smaller than Walmart, has been focusing on e-commerce and private-label brands to compete effectively in the market.

Consumer Discretionary: Disney (DIS) and Marriott (MAR)

The consumer discretionary sector includes companies that are sensitive to economic cycles. Disney (DIS), known for its theme parks, movies, and streaming services, has seen a resurgence in demand as people seek entertainment options. Marriott (MAR), the world's largest hotel company, has also benefited from the return of business travel and leisure trips post-pandemic.

Conclusion

As the economy continues to grow, cyclical stocks present a unique opportunity for investors to benefit from economic upswings. By focusing on sectors like automotive, energy, technology, retail, and consumer discretionary, investors can position themselves to capitalize on the next economic boom. Whether you're a seasoned investor or just starting out, these top US cyclical stocks are worth considering for your portfolio in 2023.

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