Nick Raich said the market has been going straight up since mid-July, really mid-June when then--it bottomed. The market has been pricing in a soft landing and a profit growth of 10% next year. In this environment, Raich said, he likes to overweight sectors that he thinks are cheap on a relative basis. He said he likes industrials--that are beaten down--and financials.
Stephen Wood said "..when it comes to the Santa Claus Rally, I don't know if he's going to arrive by December 25th- but if he comes by the first quarter of '07, that will be pretty consistent with history. We want to be more more stock specific - that means the names within the sector are more important than making a bet on the sector as a whole."
Wood also said earnings are going to slowdown in 2007 - but that comes off the third of 3 fantastic years. He said we're in the 6th year of a screaming "value bull market" and he thinks that larger cap stocks and growth stocks looks poised for 2007.