Investors will have to be more selective in picking stocks after the Federal Reserve raises interest rates, Kristina Hooper of Allianz Global Investors said Tuesday.
"There'll be greater differentiation among stocks within sectors," the firm's head of U.S. capital markets research and strategy told CNBC's "Squawk on the Street."
The Fed left the door open for a December rate hike after its Oct. 28. According to the CME Group, the chances of a rates increase next month are 50 percent.
Hooper also said that fundamentals will be driving individual stocks.
"A lot of the easy money has been made," she said. "This is an opportunity now for discernment, for being a lot more thoughtful about individual stocks, because, what we're going to see as we normalize monetary policy, is that capital markets are going to normalize."
U.S. equities were higher in midday trading, further capitalizing on October's gains.
Investors have already digested a number of mixed economic reports this week.
"What's truly remarkable about today's data is the amount of divergence in economic performance between producers and consumers in the U.S. We had a bit of positive survey data yesterday on production, but let's be clear: it's been a terrible year for U.S. manufacturing and industrial production," Ben Mandel, JPMorgan Asset Management global strategist, said in the same interview.
The Institute for Supply Management said Monday national factory activity declined for the fourth-straight month in October, but came in slightly above expectations.
"On the other hand, you have a generally positive view for U.S. consumers [and] very solid fundamentals. So, what we're seeing today is exactly that. Factory orders that were relatively weak in September, and we're seeing auto sales shoot the lights out," Mandel said.
U.S. factory orders declined for the second-straight month in September, the Commerce Department said Tuesday, but the was on its way to reporting another month of booming sales.
"That economic disparity is one which apparently … the U.S. can keep chugging along," Mandel said.
— Reuters contributed to this report.