"If investors are willing to assume the risk of being in equities, those are probably the two sectors that they should take a look at," Schoenberger said.
Tobacco has been one of the leading consumer industries over the past several days, with Imperial Tobacco soaring Friday on news that its $18.26 billion offer for Altadis had been accepted.
Financials Still Popular
Many investors have been turning back to financials, even though the subprime debacle seems to be far from over. Rich Berg, of Performance Capital Trust Partners, recommends bank stocks while discouraging short selling and Treasury bonds.
"This is a market I would never short. It's too dangerous in my opinion," Berg says. "You're better off being long because the momentum looks good and the fundamentals look excellent."
Financials, though, are a sore spot among investment professionals, who debate whether everything has shaken out yet from the credit crisis fallout.
"We're still flying with instruments with regard to earnings in '08. I don't think that clears up until maybe March, April," said Phil Dow, of RBC Dain Rauscher. "For fundamentally driven investors there still are some questions to be answered."
Dow recommends health care, technology and natural gas exploration as safe sectors for a market that believes the economy will continue to be weak. Transocean is among the leaders in natural gas exploration, though the stock has slid some over the past month.
"I don't know whether we're in a recession or not. The market's kind of acting like we might be going into one," Dow said. "Having said that, there still are very attractive opportunities even though we don't know a lot about earnings for the year."
Brian Westbury of First Trust Advisors believes concerns over subprime's effect on the economy are overblown.
"I think people need to calm down and realize this whole subprime loan problem is at most two or 300 billion dollars, that's it," Westbury said. "This is just too small of a problem to cause all this panic."
Experts in market psychology advise investors to decide just how much volatility they can stand before getting into stocks.
"A lot of investors are reacting to panic and fear," said James Grubman, adjunct professor at Bentley College where he teaches the psychology of financial planning. "That is feeding on itself and so this is a time when understanding what your risk tolerance is and being able to tolerate some of the anxiety of the markets is really important to keep your head about you."