Bob Doll: This Quarter's Rally May Have Legs

Crossmark Global Investments CIO Bob Doll suggested Friday that the fourth quarter market rally has further to go, although he said the jury’s out on whether it’s a bear market rally or signals a more meaningful change.

“We have to remember that bear market rallies are vicious. They’re stronger than bull market rallies. I don’t know that we’ve slain the bear yet,” he said on CNBC’s  “Squawk on the Street.”

Inflation remains in mid- to high single digits, and it’s unclear how much earnings will come down, whether the economy will shift into a recession and how far the Fed will go with rate hikes, Doll explained.

“Hard for me to say that it’s an all-clear sign,” he said, a day after the S&P 500 marked its largest one-day percentage gain in more than two years on lower-than-expected inflation data.

As a portfolio manager, Doll said he has been slowly adding cyclical holding, while letting go of more defensive stocks like HMOs: “The question is do I need to quicken that pace? The jury’s out.”