Which sectors do you think will do well during this particular market downturn and why?

MNSL answered one year ago …

My number one choices are Consumer Staples.

Then Health care, Utilities. In the medium term to long term, hotel sector and airline sector also will outperform the market.

Under consumer staples Food/beverages, prescription drugs and household products will do well in the next 03 years. These are the products that people need for their day-to-day life. They cannot postpone eating especially their main foods such as milk, meat, cereal etc. People need drugs for their illness. So always, there will be demand for these products irrespective of types of markets.
Even in the above sectors, some companies are overvalued. However, there are plenty of undervalued stocks with great potential through out the world. In addition, there will be some great opportunity in some emerging markets once we see further fall in those markets.

There are no demand for cars, house and other luxury products during market downturn. Now demand and sales are falling in these sectors worldwide

Only companies with less debt, positive cash flow and with great demand for their products together with higher turnover and profits will bounce back first. During downturn, people will try to invest in good companies irrespective of size. Outstanding blue chip stocks also will bounce back first.
Of course, some blue chip companies will become non-blue chip companies very soon due to their higher debt ratio and over diversification. Currently some blue chip companies finding difficulties in settling their interest to banks and they are now planning to sell their properties to reduce their debt. However, they have found other problems now. They cannot sell their commercial properties such super markets through out the world due to depressed property market and lack of demand for properties.

We can also invest in companies with following characteristics irrespective of sector:

Companies with less debt and positive cash flow.

During higher interest rate period some companies have reduced, their debts in great extend. Now they can compete successfully with their competitors with higher debt ratio.
Companies who invested their cash positions effectively to get above average returns during market down term.

Companies generating reasonable profits

Undervalued

Companies who can generate good dividend yields

Once downterm ends these companies will maker superior profits and therefore these companies also will bounce back first.