Stocks tumbled again last week, as investors digested further evidence of slowing growth in China and numerous, somewhat conflicting statements from various Federal Reserve (Fed) officials.

Investors today find themselves in a bind of sorts, caught between two somewhat contradictory risks: an emerging market-induced slowdown in the global economy and the prospect of an upcoming interest rate hike by the Fed. So, it’s understandable that many are tempted to head for the doors and abandon stocks and other risky assets.

But rather than exit the markets, investors should consider staying the course and seek potential opportunities along the way as we enter the fall season, while recognizing that more volatility could be ahead.

As I write in my new commentary, “Time to Take Stock—and Advantage of Pockets of Value,” at BlackRock, we still favor a portfolio tilted toward equities, select credit, tax-exempt bonds and inflation protection through Treasury Inflation Protected Securities (TIPS) rather than physical commodities. In addition, we view the recent selloff as an opportunity to take advantage of some pockets of value that have emerged, as well as assets that may be well-positioned for today’s “Fed hike, but still low-growth environment.” Here’s a look at some of these market segments:

Market Segments to Consider

1. Stocks in international developed markets, particularly in Europe

European stocks remain attractively priced and the eurozone economy is improving, as demonstrated by data accessible via Bloomberg. Last week, such data revealed that euro-area unemployment fell to the lowest level in three years. In addition, given stubbornly low inflation and investor concerns over global growth, there’s also the prospect for an extension of Europe’s current quantitative easing program, as many in the media speculated last week.

2. Large-cap, cyclical stocks in the U.S.

In the U.S., I believe large-cap, cyclical-oriented companies look to be in a good position to withstand the start of the Fed’s tightening cycle. The U.S. economic outlook is less than ideal, but US economic data in recent weeks still suggest a decent second-half to the year.

3. Credit within fixed income

Despite recent equity market volatility, high yield has stabilized over the past week and yields remain attractive, according to data accessible via Bloomberg. Investment-grade credit is also looking cheap, the data show, although investors may want to hold off until later this fall given pending supply.

4. Tax-exempt bonds

Finally, tax-exempt bonds are offering compelling yields relative to taxable instruments of the same maturity, based on my analysis of the Bloomberg data. Despite the recent rise in volatility, municipals have held up relatively well.

To be sure, there are areas of the market that I remain cautious of, including U.S. Treasuries and commodities. On the former, with inflation expectations still near recent lows, investors may want to get duration through TIPS rather than through traditional Treasuries. Commodities, meanwhile, have struggled all year and should continue to be pressured by sluggish growth, oversupply and the potential for a Fed-induced strengthening of the dollar.

Investors also should prepare for more bumps in the road. Though the recent correction has returned some value to markets, I expect volatility to remain elevated until either global growth stabilizes and/or investors get some clarity from the Fed.

Russ Koesterich, CFA, is the Chief Investment Strategist for BlackRock. He is a regular contributor to The Blog.