Market watcher Thomas Lee told CNBC on Thursday it will be more challenging to pick winners next year, but he's still bullish.
"I do think we have to be pretty optimistic about the economy. I think there is a lot of pent-up demand. Therefore you should really like to own equities," he said in a "Squawk Box" interview.
Lee, founder of Fundstrat Global Advisors and the former chief U.S. equity strategist at JPMorgan, noted that 2014 has been unusual because "if you were defensive and you bought utilities or you were bullish and bought tech, you had pretty much the same year."
But next year, he said, "there should be much more pronounced divergence in sectors," which would create opportunity but make picking winners and losers more difficult.
The was up more than 12 percent for 2014 as of Wednesday's close and within 26 points of Lee's year-end target of 2,100. The S&P hit its 48th record finish of the year Wednesday, while the Dow Jones Industrial Average logged its 33rd record close of 2014. The Dow was less than 90 points from 18,000, a key level that another longtime stock bull Jeremy Siegel has predicted for the end of the year.
Lee said he likes the financial, technology and health care sectors in 2015.
Against the back drop of expected Federal Reserve interest rate hikes next year, he said, "It's a tougher call to say I want to own dividends or low rates."
But he sees falling oil prices a boon to stocks. "People are looking at it correctly. It's a source of stimulus for consumers. It's really good for U.S. companies in general that use petroleum products—whether it's airlines or people who ship products."
Crude prices have fallen about 35 percent since June.
On Wednesday, BlackRock Chairman and CEO Larry Fink said from the sidelines of the Business Roundtable meeting that there's a high probability of stocks continuing to roll, as lower inflationary pressure from falling oil prices may keep the Fed "lower, longer" on interest rates.
Drew Matus, deputy chief U.S. economist at UBS, told CNBC on Thursday that low oil prices and a strong dollar are a good combination—"two things that have always worked in the past and (are) going to work in the future."
"Everyone is trying to find the cloud instead of looking at the giant silver lining," he said.
Rebecca Patterson, chief investment officer at Bessemer Trust, said the recent rally in dollar should be good for a while. But at some point, she warned, it's going to become a problem.
Darrell Cronk, president of the newly formed Wells Fargo Investment Institute, said on "Squawk Box" he's encouraged by the stronger dollar and the backdrop for stocks.
"The best point for equity markets historically ... is when you have rising earnings, low inflation and low but rising interest rates. That's the sweet spot for equities," he continued. "Equity investors should enjoy where they sit right now."