Stock Market Not Worried About Economy: Birinyi

Laszlo Birinyi
Laszlo Birinyi

Unlike the economists who are predicting continued economic weakness, Lazlo Birinyi told CNBC Wednesday he is not concerned and neither is the stock market.

"You'd be surprised how many good things are happening in the economy," said the president of Biriniyi Associates and long-time market bull.

"What I worry about is what the market worries about," he said. "Look at the breadth, look at the volume we saw the last couple of weeks. The market doesn’t seem terribly concerned."

"I’ve always argued the negative case is always more articulate, it’s always more intelligent, it’s always more compelling because it looks at the now. The market looks ahead," he added. "I could come up with all sorts of potential disasters but looking at what’s going on in the market, the market doesn’t seem to be saying anything of this will happen."

Although the bull market is going to continue into the second half of the year, Birinyi said, investors should avoid diving into broad sectors and carefully pick individual stocks.

"This is a market where you want to pick stocks...and not try to get the big themes," he said. Over half the stocks in the Standard & Poor's "have beat the S&P by at least 50 percent this year. You want to go look for those stocks. They are all over the place, including utilities."

His "core holdings" include Cummins, Priceline, BP Prudhoe Bay and Polo Ralph Lauren . He picks his stocks based on a number of factors including technical indicators, dividends, management and earnings and revenue growth.

He advises avoiding banking stocks because "historically banks make 40 percent of their gains in a bull market in the first two months, then underperform."