Expect 10% Upside by Year-End: Strategist
Stocks continued to rise Wednesday, after major indexes hit new highs for the year on Tuesday. Will the rally continue? Jerry Castellini, president and CIO of CastleArk Management and Bernard Beal, CEO of M.R. Beal & Company shared their market insights.
“Stocks are still cheaper than they were and we have a lot of pent-up buying power still sitting on the sidelines,” Castellini told CNBC. “I’m at a loss to understand where our big downside risk is and I still think the right sectors will give you a great deal of upside.”
Castellini said he expects a 10 percent upside by year-end.
“[The upside] is now driven by a narrower group of sectors rather than a broad recovery we’ve seen in all spaces,” he said and recommended the technology, energy and consumer retail sectors.
In the meantime, Beal said he is still pessimistic about the market and added that consumers have yet to get involved in the market.
"I know the consumer price index and retail spending were up, but that was government spending through the Cash for Clunkers program," he said. "So until the consumer really gets involved in this market and consumer confidence goes up, I don’t see it."
Additionally, Beal told investors to move into the bond market as opposed to the equity market and added that he remains cautious on the markets until the Dow crosses the 10,000 level.
"But there are some defensive stocks that you can be in,” he said. “I like the financial sector and health care.”
No immediate information was available for Castellini or Beal.
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