Commentators say the market entered a “correction” in December when the S&P 500 dropped ten percent from its high. In my view, this year represents the real correction. Stocks are correcting what was ridiculous December selling. Those who panicked in December regret it. They should.

The stock market has advanced 18 percent since Christmas Eve. No doubt the rise is confounding those who only weeks ago were saying the bull market was over. No, it's not. Remember those who were saying we are in recession? And then there were those who insisted the Fed would raise rates four times this year and crush the economy. Nope, the Fed was data dependent after all just as they said they would be. Finally, there were those who said stocks were (are) in an earnings recession. Never mind that equities most often advance even during years when earnings retreat.       

Stocks rebounded as investors realized the strong likelihood that global and U.S. growth will continue and earnings will grow albeit at a slower pace. This earnings season 69 percent of companies beat analyst expectations. This time last year and before it in 2017 CEOs were underestimating revenue and earnings growth, or they were simply being too cautious. I suspect the latter. In many ways, they are underestimating again, and I can see why. Investors like companies that under-promise then over-deliver and punish those that do the opposite.  Many CEOs are setting the bar low.  

Some industries are clearly on a growth track due to demographics (healthcare) and a bullish supply-demand picture (energy and its infrastructure).  Pfizer, Merck, and Becton Dickinson are well positioned.  Kinder Morgan and Enbridge are the best bets for mid-stream energy infrastructure and pipelines. Kinder CEO/Chairman Richard Kinder has purchased more than 1 million shares in the open market this year and owns more than 235 million shares.  

Another that I like is Avista (AVA ), a northwest utility. Like the stocks above, it is a dividend raiser. Owning stocks with rising dividends has been a rewarding strategy for years, and it will be for many more.  

A few people believe that what is dominating the daily news should impact the stock and bond markets. I disagree. Stock prices are a function of expectations for earnings and to much lesser degree interest rates. It's not that the many concerns we hear about aren't valid. They are valid, but they are overwhelmed by the positives about which we hear so little. Of course, bad news sells. Nothing new about that.