Bob Pavlik, chief market strategist at Banyan Partners, and Charles Bobrinskoy, vice chairman and director of research at Ariel Investments, told CNBC how investors can prepare their portfolios for the week ahead. (See their stock picks, below.)
“There are a lot of stocks that continue to move up in a very positive action—but without that volume, though, there seems to be less conviction in the market,” Pavlik told CNBC.
But he counsels optimism: “The economic reports like manufacturing and personal spending all indicate that the economy is beginning to improve.”
Pavlik said his firm is heavily weighted to the stock market, with 90 percent in equities and 10 percent in cash.
In the meantime, Bobrinskoy said investors should be looking into quality stocks, as they are currently cheap.
“What’s run so far are the cyclical names, with people trying to participate in the recovery of next year,” he said. “What hasn’t run is the high quality—in particular, health care.”
In the past, Bobrinskoy had recommended Dell, Aflac and Accenture. But, he noted, although they’re “great quality companies,” they are not at “ridiculously cheap values” like they had once been.
Johnson & Johnson
Pavlik does not own any shares of Flour or FMC.
Bobrinskoy’s family owns shares of Johnson & Johnson. His firm Ariel Investments owns shares of Dell, Aflac and Accenture.