U.S. stocks have scaled upward for most of this year after last year’s selloff, confronting any hazards along the way. However, stocks were subject to bouts of volatility in August, with the major bourses ending in the red.

The comprehensive S&P 500 Index declined 1.8% in August, its first monthly slide since February, per FactSet data. Similarly, the 30-stock Dow slipped 2.4% in August, and the tech-laden Nasdaq dropped nearly 2.2%, its biggest monthly loss so far this year, added FactSet data.

The artificial intelligence-driven tech rally that primarily boosted the broader stock market for quite some time just fizzled out in August. Recently, one of the pioneers in artificial intelligence, NVIDIA Corporation’s NVDA blowout quarterly earnings may have lifted investors’ sentiment, but the exuberance barely lasted after the Federal Reserve Chair Jerome Powell’s hawkish comments weighed on stocks.

At the conference in Jackson Hole, Powell confirmed that even though inflationary pressure has eased, it’s not yet at an acceptable level. The central bank is willing to take any steps to bring down the inflation rate to its 2% target.

Meanwhile, the core personal consumption expenditure price index, the central bank’s favored gauge of inflation, rose 4.2% annually in July, up from the 4.1% increase in June. Thus, price pressures persist and may easily compel the Fed to further hike interest rates.

Per the CME’s FedWatch Tool, even though only 11% of market participants expect interest rates to increase by a 25-basis-point in September, 42% see a similar rate hike by the end of November. Now, a rate hike doesn’t bode well for stocks as it impacts economic growth by curtailing consumer outlays and increasing borrowing costs.

A dip in consumer confidence, by the way, has already raised fears about an imminent economic slump. The rise in gasoline prices has dented consumers’ sentiment, with the consumer confidence index declining to 106.1 in August from 114 in July.

To top it off, September is traditionally the worst month for the stock market. Per chief investment strategist at CFRA Research, Sam Stovall, the S&P 500 Index has delivered an average monthly negative return of 0.73% in September, since 1945. Also, the Nasdaq has recorded an average monthly negative return of 0.86% in September, since 1971, per CFRA Research.

Thus, with things not looking up for the stock market in September after a moribund August, it’s prudent for astute investors to invest in safe stocks such as Centerspace CSR, Magellan Midstream Partners MMP, Invitation Home Inc. INVH, Trinity Capital Inc. TRIN and Runway Growth Finance Corp. RWAY for a steady income.

These stocks are dividend payers, which means they have a solid business model that helps them stay afloat amid market volatility. These stocks have a low beta (ranges from 0 to 1), making them unfazed by market gyrations. They have a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Centerspace is a real estate development company. The company has a beta of 0.93 and a Zacks Rank #1.

CSR has a dividend yield of 4.5%. The Zacks Consensus Estimate for its current-year earnings has moved up 8.1% over the past 60 days. The company’s expected earnings growth rate for the current year is nearly 5%.

Magellan Midstream Partners is a master limited partnership that owns and operates a diversified portfolio of energy infrastructure assets. The company has a beta of 0.9 and a Zacks Rank #2.

MMP has a dividend yield of 6.3%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 12.1%.

Invitation Home provides real estate services. The company has a beta of 0.9 and a Zacks Rank #2.

INVH has a dividend yield of 3%. The Zacks Consensus Estimate for its current-year earnings has moved up 0.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 7.2%.

Trinity Capital is an internally managed business development company. The company has a beta of 0.62 and a Zacks Rank #2.

TRIN has a dividend yield of 13.3%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.9% over the past 60 days. The company’s expected earnings growth rate for the current year is 2.3%.

Runway Growth Finance is an externally managed business development company. The company has a beta of 0.76 and a Zacks Rank #2.

RWAY has a dividend yield of 12.3%. The Zacks Consensus Estimate for its current-year earnings has moved up 3.9% over the past 60 days. The company’s expected earnings growth rate for the current year is 29.5%.

Shares of Centerspace, Magellan Midstream Partners, Invitation Home, Trinity Capital and Runway Growth Finance have gained 10.3%, 32.3%, 15%, 34% and 12.5%, respectively, in the year-to-date period.
Magellan Midstream Partners, L.P. (MMP): Free Stock Analysis Report

NVIDIA Corporation (NVDA): Free Stock Analysis Report

Invitation Home (INVH): Free Stock Analysis Report

Centerspace (CSR): Free Stock Analysis Report

Trinity Capital Inc. (TRIN): Free Stock Analysis Report

Runway Growth Finance Corp. (RWAY): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

This article originally appeared on Zacks

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.