For those looking for a relatively safe haven amid the market turmoil, Morgan Stanley analysts have come up with a suggestion.
They like the look of BAE Systems, and today have issued an overweight recommendation on the company.
They say: "BAE is a good place to hide amidst fears of a US recession and a global slowdown as it has all the characteristics of a defensive stock [including] heightened visibility across a diverse revenue base and a strong balance sheet. We encourage investors to build positions ahead of the 2007 results on February 21 as consensus estimates are still 10% too low for 2008 and 2009.
"BAE trades at an 18% discount to its US defence peers. However, we don't think any discount is justified, given BAE's exposure to the higher growth end-markets in the US and further opportunities for upside in Saudi Arabia."
BAE is up 3p at 471p at the moment, outperforming the market. Also moving higher is GlaxoSmithKline, 5p better at £11.94 after US regulators approved its elesclomol drug - a joint venture with American group Synta Pharmaceuticals. Elesclomol is a treatment for a rare cancer, metastatic melanoma.
