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3 top stocks as European rally stalls: Pro

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Expect Europe to be 'flattish': Pro

A few European stocks are offering gains, even as growth in the Continent's economies begins to level off, Katrina Dudley of Franklin Templeton said Tuesday.

"We are expecting the market to go through a consolidation phase," she said. "We've had a 20 percent rally since the beginning of the year, 40 percent from the lows in June and so we think it's time for Europe to kind of just be flattish as investors climb that wall of worry."

Dudley, who oversees the Mutual European Fund (TEMIX), said on CNBC's "Halftime Report " that a strengthening euro has made companies less competitive.

(Read more: Jeremy Siegel keeps his bullish Dow target)