Market Better Off Now than a Week Ago: Bob Doll

While Europe still struggles with its debt crisis, things are moving in the right direction in the United States and China, Bob Doll, Chief Equity Strategist at BlackRock, told Larry Kudlow Monday. And he thinks cyclical stocks will reap the benefits.

According to him, a few months ago, “the U.S. was heading into a recession, Europe was falling apart, China was going to have a strong landing and we had a lot of tightening going on.”

Now, the U.S. economy is showing a little growth and China is “a little less bad, maybe eventually good,” Doll said. “I think cyclicals will benefit.”

Stocks tumbled Monday, with the Dow dropping 163 points, after investors soured on a European Union plan adopted last week to enhance fiscal discipline in the euro zone in the hopes of quelling a two-year-old debt crisis.

There will be days like this when the market doesn’t think Europe can rescue its banks in time, Doll said. But he pointed out that it is not a “one way street.” And despite the volatile market, he thinks things are looking a little better.

“I think we are better off today than we were a week ago, but we’re still not where we need to be,” Doll said.

He also added, what’s happening in China is important to the global economy, noting that China’s inflation rate in November fell to the lowest level in more than a year.

“This is a step in the right direction that should allow more reserve requirement reductions.”