September was a fairly good month for stocks, but how should investors prepare for October? Dan Fitzpatrick, president of Stockmarket Mentor, and Tommy Williams, president of Williams Financial Advisors, offered their insights. (See below for their recommendations.)
“I think we’re in an era of messiness,” Williams told CNBC.
“What we see is the psychology like a human being where the markets are being driven by things that are more psychological—we need Dr. Phil rather than Warren Buffett, perhaps!”
Williams said the real risk for investors right now is being in cash.
“The W-[shaped double dip] question won’t be answered until the second quarter of next year," he said. "But it looks like pretty clear sailing for the rest of the year—I’m encouraged.”
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Fitzpatrick said he is not seeing the market weaknesses that many investors are finding.
“Volume has been increasing in the last few months as the market’s gone higher,” he said. “For equities, I think we’re going higher. There’s a big dislocation between economic numbers and economic outlook versus markets.”
Fitzpatrick said he likes the energy and defense sectors.
“The market’s looking for value and a lot of these companies are still pretty cheap going forward. Once again, we see all of these things in decline in defense spending but there’s still money coming into these stocks,” he said.
“So I think there’s going to be a money rotation. But ultimately, there’s a dislocation between what the numbers are and what’s happening in stocks.”
S&P Consumer Discretionary
No immediate information was available for Fitzpatrick or Williams.