(This is “ The Best Stocks in the Market ” brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — In times of uncertainty, people cling to the familiar and retreat to what they know. This explains a lot about life. This is why people return to churches and temples when someone in their family gets sick. Partly I’m looking for answers, but also comfort. People going through tough times may go back to old friends, lose themselves in watching old TV shows on Netflix, and if they get desperate enough, they might even call their parents. Investors are just people, so it’s no surprise that they behave the same way. This week, we witnessed an outpouring of uncertainty following the release of a new AI tool by Anthropic that essentially does 80% of a lawyer’s job. These potentially disruptive product updates are likely to become the norm in 2026, once again wreaking havoc on some of the hardest-hit stocks in 2025. Our research shows that the software sector is experiencing an unprecedented situation for any industry group. Stock prices fell nearly 30%, and the S&P 500 was within 1% of its all-time high. Every time a new innovation emerges from one of the big language models, enterprise SaaS stocks take another hit. They will continue to sell with both hands until the fog of war lifts, but no one knows when that will be. Uncertainty is a lack of confidence, and right now that lack of confidence is outweighing the reality that many of these companies are going to be okay. Investors don’t want to sit around and figure out who’s confused and who’s not. It will be easier to sell. what are they buying? They are reaching for stocks with little or no disruption risk. Energy, materials, food, and drink — ChatGPT and Claude can’t make a Hershey bar. You can’t spin up a trillion cubic feet of natural gas. You can’t just type into a box on a screen and have it output metric tons of copper. Not yet anyway. We’ve come up with a term to describe the types of stocks that have taken advantage of this year’s stock market rally. These are the HALO part of the market. HALO stock is a heavy asset and has low obsolescence. They have risks, but AI doesn’t. In fact, in many cases, AI will allow you to make even more money than you currently do. So it actually increases as you progress through the LLM. I called this the top investment theme for 2026 because I don’t think the pace of announcements will stop. I think we may continue to see an influx into these areas of the market as people price and reprice disruption risk throughout the year. So what do you do about it? I believe there are great opportunities being created in the software space for long-term, patient investors. I will talk about the rebounding ticker and the timing of that rebound another time. This column is concerned with the best stocks on the market, but software is not currently rated. So today, Sean and I will be looking at stocks in the consumer staples sector that are among the top HALO trades right now. We do not believe that you will automatically buy these stocks just because they are on the list. Many of those companies are rebounding despite not seeing any improvement in their earnings outlook. Much of what is happening is just multiple expansions, optimism about a weaker dollar, excitement about overseas consumer spending trends, and other passing ideas that have not yet translated into actual corporate performance. Maybe that will happen. Or maybe this is just a good old escape to a supposedly safe place like a box of macaroni and cheese or a can of chicken soup. So while these stocks look incredible, they require some caution. Sean has a lot to say, so we’ll come back to risk management… Sector Leaderboard As of February 9, there are 223 names on the market’s best stocks list. Top sector rankings: Top industries: Top 5 blue chip stocks by relative strength: Sectors to watch: Staples Sean — Staples is the one to chase. Suddenly, staple products are the second-best performing sector in the S&P 500 index, up 12.7% year-to-date. This would be the sector’s best return since 2021 if it ends the year here. In the S&P Consumer Staples sector, 94% of constituents are above their 50-day moving average, the highest since January 2024. No, this isn’t a meme stock, it’s the State Street Consumer Staples Select Sector SPDR ETF (XLP) from the past three years. A literal monsoon of money is coming out of software and into these consumer staples stocks. Microsoft posted its worst five- and six-day rolling returns last week since the coronavirus crash. Looking back even further, the only comparable date was October 2008. Admittedly, this is a bit selective, but the funds have to go somewhere, and they’re being spent on necessities. MSFT’s 5-day return was the worst since the coronavirus and the global financial crisis, while XLP’s 5-day return was the best since the coronavirus and the global financial crisis. We have collected all the classics on the list for you. Josh finds out which charts aren’t worth chasing and which charts are well set up. Charts Not Worth Chasing: Josh — You know I’m not afraid to buy stocks at new highs. What I don’t buy are parabolic “Empire State Building” charts like this one. Pepsi’s charts are ridiculous and someone will look stupid if they lose momentum. Wait for pullback and more reasonable RSI reset. 85 RSI does not initiate new long positions. Josh — almost absurd. This is an 82 RSI for 26 PE multiple stocks announcing a 5% earnings growth quarter. This means there is little room for error. The good news is that Coke has outperformed profits for 11 consecutive quarters. The bad news is that the stock has already broken out and you may have missed the move. Financial results will be reported tomorrow (Tuesday) before opening. For the longs, I’d probably stay long at the $73 line (the November resistance level may act as support for a pullback.) Josh — Hershey hit the list when it fell below $200 per share in early January. Reading today’s momentum, you can’t get new money with an RSI in the mid-80s. And given the verticality of the move after that, you don’t want to get into that gap. Josh — Walmart is definitely a HALO. In fact, the stock has been rising for almost a year, so as a trader, I like the breakout levels from late November, but I don’t want to start new positions at this point. I don’t buy this stock because I think nicotine is the devil, but if you’re not stuck in that mindset, the $145 to $150 area is probably plenty of support without any resistance. It broke out again in May 2025 and has been going up ever since, and this name obviously complies with that. It’s $70 for those who want to give it a longer lead. As much as I liked the PM chart, I don’t care that they’re pivoting to smokeless products like Zyns and VAPEs. But Altria is a US-focused demon, and in any case, it could be poised for a breakout, but I’d like to see 50 days above 200 days as a starting point, and ADM is not there yet. It’s also a company with 40,000 employees and annual sales of over $85 billion.It’s broken out this year, but I don’t have the same confidence as Corus or Pepsis in this space, and I’m already seeing $60 as a stop, and I think it’s been overbought for a few weeks now. it here, collect that 3% annual yield and be patient. Josh — This is a buy. Stop at $136. You don’t have an earnings report til the middle of March. Last time DG reported they crushed the estimates. Josh — Not for me. DG is cleaner. Dollar Tree reports March 4th. Let it get back above its 50-day and then we can talk. The messy charts: Josh — Nope. As the kids say, EL is not it. Josh — Sysco aka The Other Sysco has just made a big move and will likely take some time to consolidate. On paper it’s definitely one of the best stocks on the market. The question is, we’d like to see a horizontal movement in the stock price and a cooling period after this incredible surge. The opinions of the contributors are solely those of the contributors and do not reflect the opinions of CNBC, its parent or affiliates, and may have been previously distributed on TV, radio, the Internet, or another medium. The content is provided for informational purposes only and does not constitute financial, investment, tax, or legal advice or purchase recommendations regarding securities or other financial assets.The content is general in nature and personal. It does not reflect your unique personal circumstances and may not be appropriate for you before making any financial decisions.The examples of analysis contained in this article are those of the contributors and are not necessarily those of the contributors. does not reflect the official policy or position of Ritholtz Wealth Management, LLC. Josh Brown is the CEO of Ritholtz Wealth Management, LLC, and the assumptions made within the analysis do not reflect the company’s position. Click here for full disclosure.
