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Two Sectors Worth Watching

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“It’s hard to make predictions – especially about the future!”

That's what S&P’s Rich Peterson jokingly said to Dylan Ratigan on CNBC’s Closing Bell, when they were talking about the future of stocks. Of course he’s repeating a quote widely attributed to baseball legend, Casey Stengel.

But then, picking stocks is a little but like playing baseball. It takes skill, talent and a little luck.

We can't help you on the baseball side of things -- but, as for stocks Peterson has some predictions we thought you'd find interesting. He tells Ratigan, “healthcare and consumer staples are anticipated leaders,” for 2009.

How should you trade it?

Although they were not present during this interview, the Fast Money traders have said before taking a long position it's critical to do your homework. In these sectors they recommend only looking at companies with strong balance sheets and positive cash flow.

They’ve also recommended playing it with the ETFs to spread out your risk. In this case you might consider Health Care Select Sector SPDR (XLV) and Consumer Staples Select Sector SPDR (XLP).

And in case you're wondering Peterson has some thoughts on sectors to avoid. He says “materials and consumer discretionary are probably the weakest sectors for ‘09.”


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