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Quarter-End Insights

Our Outlook for Consumer Defensive Stocks

As confidence trickles back, consumers could bear the burden of rising costs in 2011.

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  • With the economic picture slowly brightening in the United States, we expect food inflation to return in 2011 as consumers bear more of the brunt of rising commodity costs.
     
  • Equity valuations appear to have run slightly ahead of the economic recovery, as risks remain on the horizon.
     
  • As manufacturers struggle to generate organic growth in mature markets, M&A activity is heating up in the consumer defensive sector.

Philip Gorham does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.