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Rally Will Be 'Extremely Selective': Strategist

Douglas Roberts of Channel Capital Research.com and John Burns of Burns Advisory Group shared their market and economic outlooks—and how investors can make money. (Scroll down for their stock picks.)

“We’re definitely seeing the early stages of a recovery,” Burns told CNBC.

“We’ve been talking about being recovery-ready since last fall, winter and spring. The S&P is up 50 percent, smaller value stocks are up substantially more than that.”

Burns told investors to keep equities and stay away from Treasurys and cash.

“Money in cash and Treasurys is not destined to do very well,” he said. “In the end, it doesn’t provide a return over inflation or taxes, whether you’re an institution, individual or a company. That can’t work well.”

In the meantime, Roberts said he expects an “extremely selective rally.”

“Right now, we’re seeing a market-based momentum melt-up,” said Roberts. “Things are less worse than expected, we’re able to beat earnings targets and that’s likely to continue for the foreseeable future.”

He told investors to focus on stocks and sectors that will benefit from government intervention.

Roberts’ Picks:

Johnson & Johnson

Merck

IBM

Microsoft

Roberts’ Pans:

S&P Utilities

Burns’ Picks:

S&P Financial

S&P Energy

S&P Insurance

Burns’ Pans:

2-Yr T-Note

5-Yr T-Note

10-Yr T-Note

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Disclosure:

No immediate information was available for Burns or Roberts.

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CNBC Slideshows:

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Disclaimer

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