The stock market has puzzled many by rallying despite millions more seeking unemployment benefits each week. The only explanation is investors are optimistic because of stimulus and economies around the world slowly allowing the reopening of non-essential businesses. It's a confusing time for even the brightest minds, and not everyone is convinced things will be rosy or even close to normal soon. Yesterday we heard the bearish grumblings of Bond King Jeffrey Gundlach who said he is betting the market is headed lower once again. "I’m certainly in the camp that we are not out of the woods. I think a retest of the low is very plausible," the DoubleLine CEO told CNBC. During the interview he revealed he "put a short on the S&P at 2,863."

In a recent report, Goldman recommended a barbell investment strategy for navigating the gradual economic restart. "The path to recovery is extremely uncertain and likely to be uneven. For equity investors, this means that many 'winners' and 'losers' will likely be determined by the ability of businesses to reopen and by the speed of consumer demand normalization instead of traditional cyclicality," wrote analysts. The brokerage also said its economists recently studied the reopening experiences of other countries and found that "initial reopening timelines often prove too optimistic, reopening plans are usually gradual, and recovery is easier and quicker in manufacturing and construction than in consumer services." 

In the near term, they suggest owning cyclical stocks that will benefit from the initial reopening of the economy along with defensive stocks that are most insulated from liquidity and default risks.  

There are three long strategies for equity investors, according to the note -

Stocks that meet this criteria are adhesive label maker Avery Dennison Corp (AVY), GPS specialist Garmin (GRMN), paint supplier PPG (PPG), and automation technology provider Rockwell (ROK).