ASX Defensive Stocks When the Markets are Very Volatile

Defensive stocks play an important role during periods of economic uncertainty because they often remain stable even when broader markets become volatile.

These companies usually operate in industries which provide essential goods or services such as telecommunications, utilities or supermarkets because demand for these products remains relatively consistent regardless of economic conditions.

The following three ASX defensive stocks are top picks right now because they have stable earnings along with reliable dividend payouts.

Telstra Group Limited (ASX: TLS)

Telstra Group Limited (ASX: TLS) is viewed as a defensive ASX telecommunications stock because services like mobile connectivity and internet are essential for both consumers and businesses regardless of the broader economic situation.

The company in the first half of FY26 reported total income of about $11.8 billion and a net profit after tax of nearly $1.2 billion which basically shows the stability of its business model.

Growth in mobile services together with disciplined cost control supported these results which helped improve the company’s financial position.

Underlying EBITDA after leases rose 5.5% to about $4.2 billion while Cash EBIT increased 14% to around $2.5 billion which shows stronger profitability and efficient capital use.

Telstra's current annual dividend yield is about 3.89%. The dividends are fully franked and paid twice a year which is why many investors consider it one of the most stable ASX defensive stocks when markets become uncertain.

Woolworths Group Limited (ASX: WOW)

Woolworths Group Limited (ASX: WOW) is seen as a defensive ASX retail stock because supermarkets sell essential goods such as groceries and household items.

The company in the first half of FY26 reported total group sales of about $37.1 billion. Net profit after tax before significant items was about $859 million which shows the stability of its core supermarket business.

Group EBIT rose 14.4% to about $1.66 billion because several segments performed better which included Australian Food and B2B operations.

Sales in the Australian Food segment rose 3.6% to about $27.6 billion while EBIT for this division increased 9.9% to around $1.51 billion which reflects strong demand for everyday consumer staples.

Woolworths also declared an interim dividend of 45 cents per share which was up about 15.4% from last year which highlights its ability to generate stable cash flows.

Coles Group Limited (ASX: COL)

Coles Group Limited (ASX: COL) is one of the top picks for defensive ASX stocks right now because grocery retailers sell essential food and household items which people buy even during periods of economic uncertainty.

The company in the first half of FY26 reported group sales revenue of about $23.6 billion and a net profit after tax excluding significant items of about $676 million which shows how stable the supermarket business remains.

Group EBIT increased 10.2% to about $1.23 billion excluding significant items. 

The supermarkets division recorded sales revenue of roughly $21.4 billion. EBIT from this segment rose 14.6% to around $1.23 billion which is due to better operational efficiency and steady demand for grocery products.

(Source: Company Reports)