Evercore ISI suggests that low-volatility stocks like Apple and AbbVie might be the hidden champions in an ongoing trade war. With tensions bubbling over into a global spat, Trump’s tariffs impacting major trade partners such as Canada and Mexico have sparked retaliations along with concerns of economic slowing. As of this week, market indices like the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average have each dipped around 2%. Back in February, low-volatility stocks showed strong performance as the trade war rumors began to build, weighing down broader market confidence. During similar tense times and tariff uncertainties in 2018, during Trump’s initial presidential term, these stocks proved their resilience. Julian Emanuel, Evercore’s senior managing director, points out, “A good defense is the best offense,” in a note he shared on Monday. “As Trade War 2.0 progresses with new tariffs set to roll out on March 4th, our strategy sees low volatility leading in defensive performance in the coming weeks and months.”
Emanuel listed several “trade war heroes,” comprising Russell 3000 stocks ranking in the top tier for low volatility and buybacks. Among those expected to weather the storm are health-care giants like AbbVie, Centene, Humana, DaVita, and UnitedHealth Group. Generally seen as a defensive play in investment portfolios, health-care stocks tend to fare better than more growth-driven sectors during economic slowdowns. Although these stocks have shown varied performances in 2025, they stood at an 8% increase year-to-date, taking the lead as the top sector of the S&P 500 during that timeframe, according to FactSet data. AbbVie, in particular, is having a solid 2025, gaining 17%. This uptick follows fourth-quarter results that surpassed Wall Street’s predictions and its recent entry into the booming obesity market. On the other hand, DaVita’s stock has slipped nearly 4% this year, but the kidney health company might be on the verge of a rebound. Chart forecasts hint at potential strong long-term performance relative to the S&P 500.
Apple has also secured its place as a reliable defensive choice. Despite a 4.7% drop in its shares this year, Ben Reitzes, head of technology research at Melius Research, mentioned that Apple has become the go-to safe bet among the “Magnificent Seven” given the recent emergence of DeepSeek—signaling a potential new upgrade phase for iPhones powered by AI integration.
Defense stocks like Booz Allen Hamilton and Lockheed Martin are also considered stable picks amid the trade conflict. Even as Booz Allen is down nearly 16% and Lockheed by over 6% this year due to fears of substantial U.S. defense spending cuts, these companies are less reliant on market fluctuations. As defense contractors, their performance hinges more on government spending and military activity than on general economic conditions.
