AXP stock: 26 cheap stocks to buy now that Omicron has hammered markets: Wells Fargo

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It could be time to do some holiday shopping not at the malls but in the bruised stock market, opines Wells Fargo's senior equity analyst Chris Harvey. 

"It might be a little early to buy the stock market, but perhaps a few "Black Friday discounts" are ready for the shopping cart," said Harvey in a research note titled "Holiday Sale!" Wednesday.

Harvey lists 26 stocks (see list below) as potential buys right now, headlined by American Express, Ralph Lauren, Expedia, Hyatt Hotels and Schlumberger. 

All the stocks on the suggested list boast the following key criteria for Harvey: (1) all rated Overweight (Buy) by Wells Fargo's analysts; (2) the stocks are down 10% or more since Nov. 8; they have positive long-term momentum; a reasonable net debt to EBITDA ratio (earnings before interest, taxes, depreciation and amortization); quality return on equity ratio; and a market cap of at least $3 billion. 

Adds Harvey, "For the first time since the market began to fade, we believe the real holiday sales may not be online or at the mall, but rather in the stock market."

The buy list from Harvey comes as markets continue to endure a turbulent stretch, which began with an awful 1,000-plus point loss for the Dow Jones Industrial Average on the day after Thanksgiving.

The Dow Jones Industrial Average plunged 652 points in Tuesday trading, while the Nasdaq Composite and S&P 500 were also deeply in the red. All 30 Dow components were in the red for the session, except for Apple and Merck. 

Stocks were clobbered by the one-two punch of Omicron variant concerns and surprisingly hawkish testimony to lawmakers by Federal Reserve Chairman Jerome Powell. 

"This tone is completely different than anything he has used over the past three years … and that, in and by itself, equates to a significant change in policy by the chairman and the Federal Reserve as a whole. In other words, the 'gradualism' that the Fed has been using all year is gone. Therefore, the way that investors should be looking at the strategy of 'Don’t fight the Fed' has changed in a substantial way this week," said Matt Maley, Miller Tabak chief markets strategist.

Markets tried to stage a comeback Wednesday, but by afternoon trading stocks were well off their highs of the session after the U.S. confirmed its first case of the Omicron variant as Yahoo Finance's Emily McCormick reports. 

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.