Markets wavered on Friday after a better-than-expected reading on consumer sentiment. How should investors position their portfolios going forward? Bob Auer, portfolio manager at Auer Growth Fund, Jerry Castellini, president and chief investment officer of CastleArk Management, and Mark Freeman, portfolio manager at WHG Funds, discussed their insights.
“For the year, it’s still got a lot of room on the upside,” Auer told CNBC.
“In the next couple of weeks, we’ll get to a little retracement, but if you look at what the bears are faced with today, they’ve got big earnings expansion and earnings surprises that’s going to fight them at least until the fourth quarter—and you just don’t want to fight that.”
Castellini said he sees the global economy surprising to the upside and the U.S. also starting to participate.
“At these interest-rate levels and multiple levels, you shouldn’t be shorting this thing,” he said of the markets.
Auer said he is “surprised” that the Dow isn’t at a much higher rate than its current levels.
“By the end of the year, you can easily see the Dow approaching 12,000,” he said. “And that’s without it even breathing hard.”
In the meantime, Freeman said investors should be focusing on quality names.
“One of the things is that we’ve seen a very strong rally, but the rally had broadened in the first quarter and high quality names are now participating—that’s different from what we saw in 2009,” he commented. “From our standpoint, we think the high quality and the role that high quality plays in the rally going forward is going to increase.”
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No immediate information was available for Auer, Castellini or Freeman.