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Market Has 15% More Upside: Chief Investor

Thursday, 10 Dec 2009 | 12:03 PM ET

Markets climbed on Thursday after a report showed jobless claims rose but the number of people seeking extended benefits declined. Will stocks continue to rise throughout the year-end? Neil Hennessy, portfolio manager and chief investment officer of Hennessy Funds, and Jack Ablin, executive vice president and chief investment officer of Harris Private Bank, shared their outlooks.

“I think we’re going a lot higher,” Hennessy told CNBC. “I like a lot of the markets—all kinds of different sectors.”

Hennessy expects many companies to initiate and raise dividends next year.

"In turn, [that] will make the stocks go up, markets go up, personal wealth will go up, consumer confidence goes up and it’s going to make the economy as a whole a lot better,” he said.

Ablin said while he doesn’t believe in a long-term secular bull market, he expects another 15 percent to the upside.

“Valuations are full,” he said.

“If you look at the price to sales ratio, investors anticipate a roughly 10 percent revenue growth over the next four quarters—I’m going to put that somewhere between 'most likely' case and best case—but we do have a lot of favorable technicals, a lot of momentum and a lot of cash on the sidelines. That’s prompting people to take incremental risks.”

Hennessy’s Stock Picks:

IBM

ExxonMobil

Wal-Mart

Cisco

Ablin’s Sector Picks:

Materials

Consumer Discretionary

Financials

Technology

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More Market Opinion:

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CNBC Data Pages:

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CNBC Slideshows:

  • Cramer's 12 Recovery Stocks

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Disclosures:

Hennessy and his family members own shares of IBM, XOM, WMT, CSCO via owning shares of his funds.

No immediate information was available for Ablin or his firm.

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Disclaimer

  Price   Change %Change
CSCO
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IBM
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WMT
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XOM
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