NEW YORK ( TheStreet) -- Laszlo Birinyi, founder and president of Birinyi Associates, told the CNBC's "Fast Money Halftime" traders he still thinks the S&P 500 is headed to 2,100 by year's end. It is currently around 2,060.
"Everything still seems pretty much in sync," Birinyi said Monday, referring to economic indicators, investor sentiment and the state of the market sectors. However, the market is likely to get more volatile next year as it enters the next stage of a bull market, which will feature rising interest rates.
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Because of this expected rate hike, which he sees coming sometime in 2015, he has a "very light weighting to bank stocks" and is long the brokerage firm companies. Birinyi sees 45% of the gains in the financial stocks coming within the first two months of a bull market. With the U.S. market is in its fifth year of a bull run, he does not like the risk-to-reward opportunity in most financial stocks.
While Birinyi did say investors who were fortunate enough to buy stocks after the big October selloff should consider taking some profits, he is largely sticking with his favorite positions headed into next year. Some of these include 3M Company (MMM) , Alaska Air Group (ALK) , Restoration Hardware (RH) , Blackstone (BX) , Union Pacific (UNP) , Kimberly-Clark (KMB) , Eli Lilly (LLY) and Apple (AAPL) .
Conversely, he does not want to own McDonald's (MCD) , which just reported weaker-than-expected comparable-store sales growth and is lower by 4% on the day as a result. Also, "I don't want to touch the oil stocks," Birinyi said.
There's two major headwinds in the oil market, said Josh Brown, CEO and co-founder of Ritholtz Wealth Management. The first is the eventual dividend cuts that even the high-quality companies may have to issue. The second is that many of the lower-quality oil companies will have trouble securing financing with oil prices so low. If investors are tempted to buy into this selloff, stick with the high-quality names, he said.
Catching a bottom in oil hasn't worked so far, according to Pete Najarian, co-founder of optionmonster.com and trademonster.com. Each rally is short-lived and continues to lead to lower prices. He is still a buyer of the airline sector, which benefits from falling oil prices. He says Southwest Airlines (LUV) is "missing out" by not having many of the fees that other airlines charge their customers.
Delta Air Lines (DAL) has been a great stock, but some of the industrial companies with aerospace exposure offer investors with a better value, said Stephanie Link, chief investment officer of TheStreet and co-manager of the Action Alerts PLUS portfolio. Specifically, she likes United Technologies (UTX) and Precision CastParts (PCP) on the long side.
Rick Rieder, BlackRock's CIO of fixed income, says the Federal Reserve's decision to move rates higher could come as soon as June and possibly before that. The economic data and labor reports have been too strong to not raise rates, he reasoned. The 10-year Treasury note will have a 3% yield sometime in early 2015, he predicted.
Bullish on GoPro (GPRO) and Apple? So is Alex Gauna, an analyst at JMP Securities. He has the highest price targets on the Street for each of these two companies, with expectations for GoPro to climb to $105 and for Apple to appreciate to $150.
GoPro's holiday sales are "absolutely on fire," he said. After the holidays, the company will make a push into international markets and into the cloud in 2015. It also has the potential to monetize its media content. Apple should also do very well this holiday season. Growth is accelerating and the company has a huge opportunity in China, Gauna concluded.
-- Written by Bret Kenwell