CHRIS VERSACE: Good morning, Action Alerts Plus members. It's Tuesday, August 23. And after yesterday's sell-off, stocks are moving higher, even though the flash August PMI data that we got for Japan, the Eurozone, the UK, and the US all moved lower month over month, reigniting recession concerns.

On a positive note, the PMI data said inflation did get better month over month. But it's still stubbornly persistent on a year-over-year basis. It also indicated that companies are starting to feel the pinch, if you will, of higher interest rates.

The PMI reports also show that supply chains continue to improve. But let's remember, as we discussed yesterday, the rate of improvement for supply chains is going to be slowed down a little bit by some of the issues we're seeing on the power front.

Remember, in China, they are actually cutting power to industrial firms, as well as Rhine issues and water issues are limiting hydrow power over in the Eurozone, as well. Now, let's dig a little deeper into the flash August PMI for the US.

Manufacturing fell month over month. A little better than expected, but still contracted month over month. The services business, however, totally fell, missing expectations, falling even further than expected. The commonality between both the manufacturing and the services sector-- the big fall in new orders, which points to further slowing in the domestic economy month over month.

To that, we can add some comments from Macy's, that it sees some concerns about consumers cutting back discretionary spending. Putting all of that together, it really confirms some of the moves that we've made in the portfolio over the last few months, adding more inelastic business model-type companies, the likes of which we have American Waterworks and PepsiCo.

Now, the market might be moving a little higher today. Reason being, it's probably thinking that, hm, with the economy continuing to slow, the Fed might slow down its rate of interest-rate increases. But we would remind members that later in the week, we have another piece of inflation data, the July PCE price index that we're going to have to really understand what it says about the pace of inflation.

Remember, too, that PCE price index is a key inflation indicator for the Fed. So we're not out of the woods just yet. And again, all of this is going to be put into the cocktail mixer, if you will, as we adjust expectations for what Fed Chair Powell is likely to say on Friday at Jackson Hole.

Now, yesterday, we put some money to work in the shares of Verizon, really following up from our comments last week about the sell-off in the shares. There's a couple of reasons that we did this. First and foremost is the shares are below the dividend yield, where they tend to bottom out. That's right around 5.1%. That indicates that we should see a real floor in the shares around the $50, $51 level.

So without question, the shares are cheap. We're also coming up on a dividend-increase announcement. Historically, Verizon has done that in early September. So that's right around the quarter. That could be a modest positive catalyst for the shares. But more likely than not, as concerns about the speed of the economy and a potential recession return, we will see investors flock back to more defensive names.

And we think about the increasing use of wireless. Is that any longer a discretionary purchase? Certainly not. It's a need to have, almost a utility that in today's connected world you can't go without.

So that was the reason why we waded into Verizon shares yesterday. And if the shares pull back a little further, we're likely to, once again, add to the position. That's a wrap for today's rundown. Thanks for joining us. We'll see you tomorrow.