Please stay tuned for important disclosure information at the conclusion of this episode.

Hello, and welcome to the Morning Filter podcast. I'm Susan Jubinsky with Morning Star.

Every Monday before market open, I sit down with Morning Star Chief U.S. market strategist Dave

Sakara to talk about what investors should have on their radars for the week, some new

Morning Star research, and a few stock ideas. Now, before we kick off this week's episode,

we want to remind viewers about Dave's upcoming in-depth second quarter 2026 stock market

outlook webinar, which is happening this week on Wednesday, April 8th at 11 a.m. Central.

The webinar is free and there's a link to register for it in the show notes and we hope you'll

join us. All right. Well, good morning, Dave. Let's start today by unpacking last week's market

activity. Last week was volatile, but stocks finished the week up on optimism that the Iran war would be ending soon.

So giving last week's market events, how would you suggest stock investors be thinking about their portfolios today?

Good morning, Susan.

I think investors really should be looking at using the volatility that we've had thus far this year to be able to

readjust their portfolios as we've seen a lot of valuations change over just the past, you know,

five weeks. Now, if you remember in our 2026 outlook, we noted a number of different reasons why

we thought 2026 was going to be a lot more volatile than 2025. And as such, we recommended

investors should look at having a barbell-shaped portfolio. Essentially, half the portfolio invested

in high-quality value stocks. Within the value category, we specifically highlighted the energy sector.

Energy sector was one of the most undervalued sectors last year, paid pretty good dividends.

And we noted that it would act as a natural hedge in your portfolio, just in case inflation were to rear its ugly head or geopolitical conflict were to make a comeback.

And then, of course, the other half of the portfolio were recommended to in a growth stocks, specifically those that were tied to artificial intelligence and technology.

So essentially what the strategy was is, you know, if the market were to rally, we'd expect AI and tech stocks and growth stocks overall to rally much faster to the upside than the rest of the market. And as that part of your

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