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Here’s what keeps Blackstone's Byron Wien up at night

Byron Wien still sees a 20 percent return in the S&P 500 for 2014, but the Blackstone Advisory vice chairman admits there are things that keep him up at night.

Specifically, he's concerned about geopolitical events—including the fighting in Gaza, Iraq and Ukraine, the situation with Iran and the tensions in the South China Sea. Wien told CNBC's "Closing Bell" he believes these issues will decrease in intensity over the next year and therefore the market can move forward. However, he said he's "not right all the time."

"Right now the market is saying that all of these things are going to work out favorably," Wien said.

"Well, maybe most of them will. But if one of them flares up, if the price of oil shoots up, that could create a calamity in the market. So that's what keeps me up at night."

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Looking at the current market action, Wien thinks the correction can still go further because "sentiment is too positive." However, he thinks shares will end higher by year-end, with the S&P likely hitting 2,300.

Byron Wien
Adam Jeffery | CNBC
Byron Wien

For those looking to get in on the action, he suggests the biotech sector, despite its recent correction.

"I think there are going to be a lot of new drugs introduced in most of the major diseases," Wien said. "Not everyone will be a winner, but there are going to be some big winners out there."

In general, he thinks second-quarter earnings are not as strong as they appear. While net income was up about 4 percent, earnings were up twice that, he said, thanks to share buybacks and "other accounting techniques."

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However, Wien expects the second half of 2014 to be "a whole lot better" than the first half, with the economy growing 3 percent.

"If that's the case, I think earnings will keep up and revenues will improve."

Beyond 2014, he said the economic outlook is pretty favorable for the United States, but there are some signs that Europe is slowing and China is too dependent on debt creation for growth.

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"We really need a worldwide expansion in order for the U.S. to continue to do well. The U.S. can't continue to do well on its own," Wien said.

"Right now I think world growth looks OK but if that changes, that could darken the outlook for the U.S."

—By CNBC's Michelle Fox

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