Maybe Wall Street needs a good shrink. Psychiatrists call the problem “cognitive dissonance,” the mental discomfort experienced by someone who holds two or more contradictory beliefs. It’s a form of psychological stress that can paralyze decision making.

The bull market lives on, but it’s been stumbling as stocks seek the next definitive catalyst for another upward surge. Over the last few days, we’ve witnessed intra-day u-turns as investors react in knee-jerk fashion to the headlines about mixed corporate earnings, global economic deceleration, impeachment battles, Brexit chaos, and trade tensions.

The result? Stocks have been volatile, sharply swinging between green and red, as investors try to make sense out of the confusion. Below, I’ll show you how to position your portfolio under these trying circumstances.

A pronounced source of dissonance is third-quarter earnings season.

Sector bellwethers such as Texas Instruments (NYSE: TXN), Caterpillar (NYSE: CAT), and Boeing (NYSE: BA) this week have missed expectations on the top and bottom lines. However, big banks such as JPMorgan Chase (NYSE: JPM) and Bank of America (NYSE: BA) have exceeded expectations.

For third-quarter 2019, the S&P 500 is expected to post a year-over-year (YoY) decline in earnings of -4.7%, but with YoY growth in revenues of 2.6%. This disconnect raises questions about net profit margins. How are they faring?

Again, the picture is mixed. The blended net profit margin for the S&P 500 for Q3 2019 is 11.3%. Blended combines actual results for companies that have reported and estimated results for companies that have yet to report. The following chart provides long-term perspective.

Nine of the 11 sectors are reporting a YoY decline in net profit margins in Q3 2019, led by the sectors of energy (5.4% compared to 8.1%) and information technology (20.6% vs. 23.0%).

Worsening the dissonance are mixed economic numbers. Unemployment is low, but retail and home sales have dipped. Several recent readings of industrial activity, both in the U.S. and overseas, show downward momentum. Manufacturers are preparing for hard times.

China, the growth engine of the global economy, is slowing. Germany, the locomotive of the European economy, is contracting. Brexit has reduced Britain to a clown show. Overhanging these woes is the trade war, which grinds on like trench warfare.

FactSet reports that corporate managers on earnings calls for the Q3 season are increasingly citing the Sino-American trade war as a drag on margins and revenue.

Contrary to the misinformation spread by partisans in the trade war, tariffs are not paid by governments. They’re paid by companies, which in turn either pass the costs along to customers or take a hit on margins (or both). Tariffs are tantamount to taxes.

Read This Story: Stocks Volatile as Cracks Appear in Trade Deal

Despite the smooth-sounding assurances of trade negotiators to appease investors, there has been no progress on the trade war. Zilch. Nada. You shouldn’t expect any, until after the 2020 election. If you hear someone on CNBC say that trade peace is around the corner, they’re either deluded or lying. And if you want to lose money in a hurry, base your investment decisions on tweets.

Smart investment moves now…

You should emphasize sectors appropriate for the late stage of economic recovery, such as utilities, consumer staples and health care. Especially appealing right now are utility stocks. I’ve been beating the drum lately for utility stocks and for good reason.

The decade-long era of ultra-low interest rates has been beneficial for dividend-paying stocks such as utilities. Not only can utility stocks offer payouts greater than the yield on 10-year Treasuries, but they’ve also racked up spectacular share price appreciation.

With interest rates still at low levels and growth stocks generally overvalued, high-dividend utilities are an attractive hedge. The Federal Reserve is expected to lower interest rates again at its meeting next week, another tailwind for utilities.

Utilities exchange-traded funds (ETFs) can be accurate barometers regarding overall risk appetite in various market climates. As risks mount this year, investors have been fleeing to the traditional safe haven of utilities.

The utility sector has been on a tear so far this year but it’s not too late to jump aboard. The sector should continue outperforming.

As of the market’s close on Wednesday, the benchmark Utilities Select Sector SPDR (XLU), the largest utilities ETF by assets, had returned 24.4% year to date, compared to a YTD return of 21.3% for the SPDR S&P 500 ETF (SPY). The XLU’s performance is all the more impressive, when you consider that utilities are dividend payers and less risky than the more growth-oriented broader market. Safety, growth and income make an unbeatable combination.

However, not all utility stocks are created equal. Nor should you overpay for utility stocks. For a “dividend map” that pinpoints reasonably priced, best-of-breed utilities, click here now.

Another sector well-positioned now is real estate, which tends to perform well during the late phase of economic expansion. For a little-known real estate play that’s poised to hand investors big profits, see our presentation.

Meanwhile, our team of researchers have found a way that allows individuals to collect government cash via the Social Security program, by exploiting an obscure legal loophole. It’s an income boost available to everyone, but few bother to exploit it. We lift the curtain on the opportunity here.

Does this roller-coaster stock market give you anxiety? You don’t need Sigmund Freud to feel better. The best therapy is making money.

John Persinos is the managing editor of Investing Daily and the premium trading service Utility Forecaster. You can reach him at: mailbag@investingdaily.com