Stocks have been climbing higher on Tuesday so which groups are driving the markets and can it continue? Alan Lancz, president of Alan B. Lancz & Associates and Bill Smead, CEO and CIO of Smead Capital Management shared their market insights and stock picks.
“It’s a struggle between fundamentals and a lot of cash on the sidelines,” Lancz told CNBC. “But what we’re doing is reducing risk—we’re taking money off the table and putting them into higher quality names. The time to take risk was 6 to 9 months ago, and not now.”
In the meantime, Smead said investors have been trading the markets mainly based on rumors.
“The public believed the doomsayers in March who said the economy is going to be terrible forever and now every time someone brings up that we could have a significant correction, they believe that too,” he said. “The inevitable fact is that money is going to chase wherever it ultimately going to get treated the best.”
Smead said he also expects the higher quality names to be the market leaders and recommended the following names to investors.
Lancz owns shares of NOK, PALM, SVU, VRSN.
No immediate information was available for Smead or his firm.