5 Blue-Chip Stocks for a Double-Dip Recession

5 blue chippers to buy to ride out the double dip MINNEAPOLIS (Stockpickr) -- According to the market, a double-dip recession is upon us. Finally, on Wednesday, the S&P 500 broke its seven-day losing streak and the Dow avoided its ninth day of losses as stocks finished slightly higher across the board.

The losing streak was the worst we had seen since the 2008 financial crisis. Being the forward-looking instrument it is, the market is clearly placing bets on consecutive quarters of negative economic growth.

The recent losses were apparently about much more than the debt ceiling debate, which resolved itself by the Aug. 2 deadline. Rightly so, the market cares more about things such as jobs and GDP growth. With weakness in those categories, stocks are likely to struggle. It matters little that corporate earnings are for the most part strong, with many companies increasing future guidance.

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Investor psychology is shot. Individual investors are skeptical, unwilling to get burned by buying high once again. Financial stocks have been horribly weak for most of the year. The recent selling has been marked by weakness in the important transportation sector. Other than gold, there are few places investors can hide.

I suppose that explains why Treasury securities are doing so well. In spite of the threat of a credit downgrade, U.S. government bills, notes and bonds are still considered a safe haven. For those not willing to stomach any sort of risk, there is an alternative. I would recommend blue-chip stocks in this environment.

Given the uncertainty, I like the idea of the strongest being the survivors. These blue-chip stocks are likely to thrive when others struggle. In today's market, blue-chip stocks are cheap relative to earnings, and sales overseas remain strong and are more valuable assuming a falling dollar. There is plenty to be optimistic about.

Here are five blue chip stocks to ride out a potential double-dip recession.