Unilever PLC (UL)

Weekly Stock ListWe anticipate that activity in the consumer sector, which was the primary driver of GDP growth in 2022, will slow as the Federal Reserve continues to raise interest rates and companies keep cutting jobs. The sector is all-important to the economy and accounts for about two-thirds of GDP. The main driver to the consumer sector is the jobs market. While the domestic employment environment is in better shape than it was two years ago, it is starting to show signs of deterioration. Though the unemployment rate is 3.5%, it seems headed inevitably higher in the wake of layoff announcements from high-profile companies such as Microsoft, Alphabet, Amazon.com, Salesforce.com, Goldman Sachs, and Morgan Stanley. Meanwhile, consumer balance sheets appear to be weakening somewhat after multiple quarters of spending growth. A combination of pandemic-related factors -- such as economic shutdowns and aggressive fiscal spending -- resulted in a sharp improvement in household finances in 2020. Indeed, the stimulus program initially lifted personal savings to almost $5 trillion. But that money has been spent, and then some: the personal savings level has come down to $625 billion, below the $1 trillion average level in the decade prior to the pandemic. With savings tapped, a slowdown in the all-important consumer sector seems likely in 1H23. Here are some of our top "cautious consumer" stocks for 2023.