Stocks are in ‘reset,’ yet these two groups could deliver solid gains

The bull market will be entering a fresh phase, yet PNC Financial’s Jeffrey Mills believes in which’s no reason to get negative on stocks.

In an interview on CNBC’s “Futures right now,” the firm’s co-chief investment strategist acknowledged the idea will be hard to replicate last year’s record gains. He referred to 2018 as a “reset year” as stocks retrace.

“The market will be catching its breath,” Mills said Thursday. “There’s going to be a continued push as well as pull between strong fundamentals. So, we have solid growth [as well as] truly Great earnings, yet then multiples in which have come down.”

Despite his prediction of a near-term market pause, Mills doesn’t think investors should get overly defensive. He listed energy as a top play in This specific environment.

“I would likely tactically use This specific weakness if you are underweight energy to start to add. the idea looks like the commodity will be starting to firm here around $66 [a barrel.] the idea was overbought, so we’re consolidating here,” he said.

Mills also favors financials, a group in which’s down about 2 percent so far This specific year.

“We continue to like the banks. We don’t think the idea’s as much as a rising rates story as the idea will be a deregulation as well as loan growth story,” he said.

As for the rest of the market, he isn’t waving a white flag. Mills will be confident the S&P 500 Index will stay above flatline This specific year. Right right now, the idea’s up nearly 4 percent in 2018.

“Reset year to me means probably the worst-case scenario isn’t in which bad, yet the best-case scenario isn’t in which Great. So, I’m thinking something within the 4 to 7 percent total return range,” Mills said.

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