Published: Tuesday, 5 Jul 2011 | 12:47 PM ET
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Text SizeBy: Margo D. Beller
Special to CNBC.com
Special to CNBC.com
Paul Schatz, president of Heritage Capital, told CNBC Tuesday that after weeks of bullishness, he still expects the market to hit new highs this month and into early August.
But if the "rocket can’t go high enough into the stratosphere," he sees theS&P 500 falling back to 1250.
He is already searching for signs of weakness. With the Federal Reserve done with quantitative easing, "I’m looking for signs that liquidity is abating. I’m watching the performance of high-yield bonds. They are pretty good bellwethers of liquidity."
He is also looking foroutperformance in small-cap stocks because "they should sniff out any draining of liquidity."
Schatz, who gave no specific stock picks, also wants to see which sectors will lead the market higher.
"I don’t want to see consumer staples and utilities and health care leading this next rally," he said. "I want to see energy lead. I want to see some areas oftechnology lead. I can hope that financials lead but I don’t think that’s going to happen. I want to see some folks willing to take risks."
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CNBC Data Pages:
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CNBC's Companies in the News:
CNBC's Companies in the News:
ExxonMobil [XOM 81.60 
-0.41 (-0.5%) 
]
-0.41 (-0.5%) ]National Oilwell [NOV 80.05 
1.74 (+2.22%) ]
1.74 (+2.22%) ]Ameron International [AMN 85.08 18.81 (+28.38%) ]
18.81 (+28.38%) ]Netflix [NFLX 289.63 21.64 (+8.07%) ]
21.64 (+8.07%) ]Pfizer [PFE 20.78 0.03 (+0.14%) ]
0.03 (+0.14%) ]______________________________
Disclosures:
Disclosures:
Disclosure information was not available for Paul Schatz or his company.
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