Stocks could end the year higher despite slowing growth

Even as growth shows signs of slowing, one top strategist says the rally still has plenty of room to run. Brian Levitt, Chief Market Strategist at Invesco, joined TheStreet to explain what could drive the market higher through year-end.

Related: Stocks could still rally with higher for longer interest rates

Full Video Transcript Below:

CAROLINE WOODS: What is your outlook for the stock market as you think about this summer and the back half of the year?

BRIAN LEVITT: Yeah, I think the market is going to end the year higher. The question that most investors probably have is what drives that. And I know this was going to be the year where markets broadened. And we were going to see small caps and value do well. And that was really more based on an environment in which growth and inflation were pretty good combined. We're now in a slowing growth environment. Leading indicators are pointing lower sentiment weakening, which means you want to be back to higher quality, larger cap mega-cap. So the concentration everybody was worried about at the beginning of the year probably continues to persist with us. At some point, we'll get some policy easing and some re-acceleration in activity, but that doesn't seem to be the story for the second half of the year.

CAROLINE WOODS: You think the market will be higher by year end. How much higher?

BRIAN LEVITT: I think you'll see a year where I mean, it's not going to be a year where the market's up 25% like we saw back to back, but could we have high single digits or low double digits. Yeah I don't see why not. The growth picture looks good. The rate picture stable inflation expectations are contained. So yeah it's a backdrop. Again I'd be much more worried if we were seeing breaks in the credit market. And we're just not.