The Dow, S&P 500 and Nasdaq are posting their best gains in almost a month, with the Dow up more than 100 points. But even with the big gains, the S&P could still post its 21st consecutive session of moving less than one percent.
Barry James, co-manager of the Morningstar 5-star rated James Balanced Golden Rainbow Fund tells CNBC's "Power Lunch" on Thursday the market's inability to hit new highs is reflective of the doldrums market of the last 18 months.
"Since the end of 2014, the Dow and S&P 500 are almost unchanged. We have seen prices fluctuate, but the fluctuations have been much lower than normal," James said.
He sees some good news and bad news with this trend. "First, the bad news. After one of the rare doldrums events, stocks did below normal in the next six months, averaging gains of only 2 percent. The good news, in the 18 months following the doldrums, stocks averaged gains of 17.7 percent, which is higher than usual," James said.
In this environment, James is telling clients to hold a moderate position in equities and try to upgrade positions where appropriate.
Two stocks he likes now are Brandywine Realty Trust and Verizon. "Brandywine Realty Trust is a diversified leasing, property management, development, redevelopment [company]. They can take advantage of different opportunities within the real estate cycle," James said.
With Verizon, James likes the outlook for the company. "Verizon has $21 billion in free cash flow to support a 4.5 percent dividend yield," James said.
Verizon and Brandywine Realty Trust are higher during trading.