I’d buy cheap shares before the stock market snaps back!

I see cheap shares everywhere at the moment and I totally understand why. The global economy is still reeling from the shock of the pandemic and subsequent supply chain issues.

Persistently high inflation and persistently low interest rates fuel uncertainty, as does the specter of a global recession. And then there is still no end to the terrible conflict in Ukraine.

And to make matters worse, we have just seen the biggest bank failure since 2008. This has shaken the confidence of investors in the global financial system itself.

But I believe this serious problem will not last. At some point, inflation will fall, as will interest rates, and global economic growth and technological progress will continue.

The stock market will recover and be higher over time.

Discount innovation

I see some long-term opportunities in it FTSE 100 today. The first and most obvious to me is this Scottish Mortgage Investment Trust (LSE: SMT).

The trust’s website greets us with the words “Tomorrow. There first. Invest in the process.” The portfolio is packed with companies that represent the future of high technology. Tesla, AdyenSpaceX, Stripe, and many other examples.

The problem now is that many investors are interested in the next few weeks rather than the next few years. The investment horizon is too short. But I don’t think it will be like that forever. A new bull market will take shape.

Additionally, Scottish Mortgage shares are currently trading at a 19.9% ​​discount to the trust’s net asset value (NAV). It’s essentially like buying a £1 portfolio for 80p!

Buying shares for less than NAV means I have the potential to turbocharge returns if and when the discount narrows.

Of course, there is a risk that the discount will remain or even increase. But it’s a risk I’m willing to take and I bought the stock.

More potential offers

Another stock I like despite the uncertainty in the financial sector is insurance companies Legal & General. At 229p, it trades on price-to-earnings (P/E) times just 6.4, with a prospective dividend yield of 8.6%.

Next, Glencore shares are down 17% since one year. Again, that leaves this mining stock with a low P/E (4) and a high dividend yield (8%).

I don’t know what will happen to commodities and stock prices in the short term. There is a risk that both can refuse.

But demand for copper should increase next year as the power grid needs more. And as one of the The world’s largest producer and marketer of copper, Glencore is well-positioned to benefit.

I would have bought both shares today if I hadn’t already.

FTSE 250

At FTSE 250I’m a pub chain J.D Wetherspoon can be a bargain. The stock is down 49% in five years, having been hit hard by the pandemic.

Obviously, the ongoing cost-of-living crisis poses challenges to the customer base. But I think brands and value propositions give us a long-lasting competitive advantage.

The company is likely to gain market share as people shun more expensive restaurants for more affordable pub grub down the road. So I’ve put Spoons stock on my watch list.