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Real Story: Growth Fixation

Tuesday's rally shows fund managers are more worried about recession vs. hoping for a Fed rate cut.
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Tuesday's rally is a sign of "a market looking for direction" rather than a sign of a sustainable advance, Robert Pavlik, chief investment officer at Oaktree Asset Management, tells Aaron Task in Tuesday's Real Story podcast.

With GDP estimates coming down across Wall Street and inflation remaining a concern, Pavlik says the near-term outlook remains uncertain. As a result, he is recommending investors overweight large-cap companies with high-quality management and demonstrated earnings growth such as

NYSE Group


, which jumped 5% Tuesday ahead of the closing of its Euronext transaction.

Other "industry leaders" Pavlik recommends include


(BA) - Get Boeing Company Report


General Dynamics

(GD) - Get General Dynamics Corporation Report


United Technologies

(UTX) - Get n.a. Report



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(MCD) - Get McDonald's Corporation Report



(MO) - Get Altria Group Inc Report



(T) - Get AT&T Inc. Report


Task says Tuesday's rally suggests investors are more afraid of an economic slowdown vs. hoping for a

Federal Reserve

rate cut. Task notes that the advance came in the wake of stronger-than-expected existing-home sales and chain-store sales data, which make a rate cut less likely vs. more.

In the remainder of the podcast, Task addresses the day's other corporate news, including

Cell Genesys'


big move after the company's GVAX immunotherapy showed a better-than-expected survival rate during a second midstage trial as a treatment for prostate cancer.

Task shared

biotech writer Adam Feuerstein's view on whether or not Cell Genesys is potentially "the next



," which has soared in the past week after an advisory panel to the U.S. Food and Drug Administration recommended approval of its own prostate cancer vaccine.

Other stocks on the move Tuesday included


(HUM) - Get Humana Inc. Report


Chicago Bridge & Iron



Marshall & Illsley




here to listen to the entire podcast.