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Hunting for value? Look here, pro says

For investors aiming to find value in today's market, they should look to two sectors—consumer discretionary and technology, one market strategist told CNBC on Tuesday.

With the S&P 500 up more than 6 percent for the year, consumer discretionary is flat—and therefore has some real catch-up potential, said Nick Colas, chief market strategist at ConvergEx Group.

"It hasn't participated in the rally," he told "Power Lunch."

"Secondly, we're getting better news about the consumer going into the latter half of the year. ... That lines us up for a pretty good holiday period, which is a very important catalyst for consumer discretionary names."

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Trader on the floor of the New York Stock Exchange.
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Trader on the floor of the New York Stock Exchange.

Consumer confidence hit 94.5 for October, a seven-year high, beating estimates. That, coupled with positive earnings and the anticipated end of the Federal Reserve's bond-buying program sent U.S. stocks higher Tuesday.

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While technology's year-to-date performance of more than 10 percent is better than that of the S&P, the fundamentals are good and valuations are reasonable, Colas said.

"You've got increasing share of consumer wallet internationally as well as domestically and again, benefiting from a better holiday and better corporate spending as we budget for 2015."

That said, Colas still expects more volatility between now and the end of the year. He noted that while the typical year has 51 days where the S&P moves more than 1 percent, this year it has occurred only 31 times.

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Plus, investors are worried about a rising rate environment and the key headwind for consumer cyclicals is always the Fed, he said. However, he added, since rates will increase more slowly than expected, it will help the sector.

—CNBC's Jennet Chin contributed to this report.

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