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More Upside if S&P Passes This Number: Market Pro

The Dow finished slightly higher on Tuesday in light, choppy trading following Monday's robust rally. Is this rally sustainable—and how much further does the bull have to run? Eric Ross, director of US equity research at Canaccord Adams, and Rick Bensignor, head of research at Execution LLC, shared their market outlooks.

Analyzing the Rally

“You really have to see what happens in the next week—if the S&P futures get through 1,097.75, so we’re half a percent away—and how we get through it will determine what happens through year-end,” Bensignor told CNBC.

“If it gets done the correct way, then we have 5 to 6 percent more to go, minimum.”

Bensignor added that investors who have tried to “outsmart the market” this year actually got hurt more than the trend-followers.

In the meantime, Ross said he is “long, but cautiously long” on the markets.

“We’re not necessarily putting new capital to work and we’re certainly not trying to short the market,” he said. “If we reach some higher levels, it would get a little more attractive, but there’s no news until January and that’s what we’re waiting for.”

Ross said the market is driven by fundamentals and liquidity.

“We certainly had a big liquidity crisis at the beginning of the year, but if you look at the rally since March 9, we’ve seen it grow because of better than expected fundamentals on the earnings season and with the economic situation,” he said.

“We have a lot of money out there, that’s something like $1.2 trillion that needs to be spent over the next year or two, and that’s real velocity-driven liquidity.”

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No immediate information was available for Bensignor or Ross. ______________________________