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U.S. and global stocks rallied in the first half of this year, but with sticky inflation, continued Fed rate hikes, and the possibility of a recession on the horizon, the outlook for the rest of 2023 looks uncertain. The S & P 500 soared by 15.9% in the first six months of the year — its best first half since 2019. The MSCI World Index , meanwhile, was up over 12%. Among global stocks, Japan was the top performer, with shares up over 16% year-to-date at the mid-year, according to data compiled by Julius Baer, while European stocks gained 7.47%. China fared the worst, logging a 9% loss. “Going forward, we expect defensives to outperform as growth slows and geopolitical and policy uncertainties increase. Stock-picking is key, as many defensive sectors are challenged by structural trends,” the Swiss private bank said in a report Monday. Stock screen Despite many stocks rallying over the year so far, analysts expect some to continue to soar over the rest of 2023 and beyond. CNBC Pro screened for U.S. and global stocks that are among the top performers over the year to date — up over 15% — with an average analyst price target that implies upside of at least 30% over the next 12 months. All of the stocks have a buy rating from at least 60% of analysts covering them. EV makers BYD and Stellantis both made the list, gaining over 20% each in the first half. They are also well-loved by analysts, with a more-than 70% buy rating and over 30% potential upside. Evercore last month in a note called Buffett-owned BYD “the sleeping electric vehicle giant of China.” Meanwhile, Stellantis — which owns auto brands including Chrysler, Citroën, and Jeep — earlier this year said that it would be adding nine new battery electric vehicles to its range as it looks to further tap into the lucrative market , which is currently dominated by Chinese manufacturers. Baidu also appears on CNBC Pro’s screen, with 32% potential upside and a 74% buy rating. Morgan Stanley was bullish on the Chinese Internet services giant in a June note, calling it the best AI play in China and the “most obvious beneficiary” of the $7.4 trillion AI opportunity in country. Super Hi International Holding was the top performer on the screen, with a 52.7% gain in the first half, and the only stock with a 100% buy rating. Super Hi, the international operator of the wildly popular Chinese hotpot chain Haidilao, also has among the highest potential upside at 51%. Only three U.S. stocks made the screen of the S & P 500, and they are all entertainment and/or hospitality stocks: Warner Bros Discovery , and casino operators MGM Resorts and Caesars Entertainment .
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