How To Navigate The Ukraine Crisis-Induced Market Chaos

The Ukrainian crisis is showing no signs of abating, and financial markets have been in turbulence since Russia invaded the Eastern European country.

Against this backdrop, here are ideas on how traders can insulate themselves from the market turmoil. 

Valuation Compression Squeezes Tech Stocks:  The risk-off sentiment that prevailed since the start of the year was exacerbated by Russia's invasion of Ukraine, Wedbush analyst Daniel Ives said in a note.

The resultant valuation compression has battered the tech space, the analyst said.

Fed To Slow Down Monetary Policy Normalization: Jamie Cox, managing partner for Harris Financial Group, said the Fed is likely to raise rates in small increments. 

At the March meeting, the central bank could raise rates by at most 25 basis points as opposed to expected 50-basis point hike, he added.

Related Link: How Bitcoin, Other Cryptocurrencies Could Serve As Workaround For Russians Facing Global Sanctions

Selective Focus The Key: Wedbush's Ives recommends selectively focusing on defensive tech stocks that have significant free cash flow, and oversold tech giants.

Tech stocks are the most oversold since 2014/2015, the analyst said. These periods of global chaos should be used to buy the tech winners that are "oversold in a panic-like sell off," he added.

Ives recommended top names such as Microsoft Corporation AAPL, Apple, Inc. AAPL, Oracle Corporation ORCL, Adobe Inc. ADBE and salesforce.com, inc. CRM as the ones to own on the sell-off.

Chip names could also be safety plays in the turmoil, he added.

Cybersecurity, according to Ives, is one sector that is poised to surge, given the expectation of elevated level of cyberattacks.

"With many high-profile cyber security attacks coming from Russia over the past few years it's a matter of when not if this increased cyber warfare activity kicks into the next gear," Ives said.

Core cyber security names most likely to benefit from this additional Ukraine-driven spending include Zscaler, Inc. ZS, Palo Alto Networks, Inc. PANW and Tenable Holdings, Inc. TENB, Ives said.

Harris Financial's Cox recommends investors with exposure into energy and commodity, to use the price spikes to rebalance into heavily beaten down software names. The analyst also recommends buying cybersecurity companies.

Related Link: 10 S&P 500 Stocks With Highest Revenue Exposure To Russia, Ukraine