Bob Shearer, CFA, Managing Director, is a member of the Fundamental Equity division of BlackRock's Portfolio Management Group

Our guest is Bob sheer thought as a managing director -- -- he's also the portfolio manager of the equity dividend fund at black -- investments Bob welcome to the show -- Good morning or are you -- good. Bob you know the markets had a pretty good year thus far -- -- depending what index you're looking at I mean yes and tees up what 11%. A year to date. Is a market starting to slow down as the ray is the rally losing steam at this point. Well I think we are seeing a little bit of a slowdown. Certainly. He DO earnings reports that we've been seeing through this reporting season. And we've been meeting bottom line but the top line has not necessarily. Been coming through so I think we are -- some slowdown and we obviously does some of these foreign markets that have been prime drivers of the market in the past. Are also slowing down that we've seen in China but we think that the in the second half of the year that -- eaten probably will pick up. -- the NB a lot of money's been flowing into dividend paying stocks were the you're looking at Telecom news. Some of the pipelines health care stocks utility stocks have these stocks become too expensive from your perspective. Well -- when we look at the -- that top. Tesoro also devoted performers we always -- at the top desk I -- And it has it does not. Provide the strongest growth I think that's the people focused on is going to after those top -- sectors. That's why we try to focus our influence our -- -- consistently draw there divisions over time. If we look at our portfolio which -- -- the past decade has had a more than half percent growth -- and dividends. They are still trading at a discount to the -- average for the Russell 1000 value of both of them in the terms of peace talks. If we look at the dividend -- they don't seem that expensive -- Why is that why you why have people not discovered those yet. Yeah I think people when they park while yielding to trick legal for the yield to -- they don't focus on the protest sparked. The only does that when you can get a little bit it did any made only get 2% dividend lifting you might -- you might get another seven or 8% in terms of price appreciation I would think. -- -- -- -- would -- the don't do what about the financial sector Bob are you buying anything there or are you like a lot of other fund managers. Staying away from you know the the big bad bank stocks Bank of America's cities he had the usual list -- the suspects. You worst we were apportioned to be under -- going into the financial crisis and -- that we store are under way to financial. You know the Dodd-Frank a lot of these pages -- -- or still are written yet so we have that. To come through in them despite the severity of the recession. In the corporate America has managed to this downturn very well. And a lot of the companies herself funding and have very good cash from their balance sheets so they really don't. There's no need for a loan growth. For these companies. So I think until you really get the company's you know spend down their cash and start to build in our and our capital spending. That the F financial are probably gonna be -- as sluggish course for a long time. I think -- free after a period of time. They would when you looked at the idea of hitting growers see you try to identify companies where you think the dividend yield is an increase over time. Are there certain sectors that provide more of that than others like is that the technology sector is -- energy development it. With what sectors provide the best opportunities for investors that are looking for stocks that grow their dividends. Not technologies little Specter in the past has not been a very high dividend Payer but you know we are seeing companies. Starting increased dividends like Disco. In the apple of course is declared a dividend. You know but -- tradition I think Compuserve are dealing with a branded. Staples companies Procter & Gamble Kraft. Car companies that we focus on an Indian Controlled as well. You know which are the only is -- -- the areas. Up until. Recently which have been seeing some strong growth. Or equipment from the are emerging markets whether it be you know in the United Technologies or caterpillar. Are also seeing some strong demand so you know we're looking across the board company -- are have a significant portion of their. Revenues coming from the -- of the world that are growing. And are trying news minute more or creme an improvement for the first quarter took the European expose companies. In -- what about the elections Bob how are they impacting the investment strategy are you waiting to buy certain stocks until after the November elections. No we know we're looking -- pretty much totally out there at the areas that are gonna continue to draw. We do think there is a slowdown as people. If I don't we can see what the outcome of the elections will be so. I think regardless of which party wins the election. One -- uncertainty is lifted. That we will people have a better roadmap. And what they're gonna do you'll -- additional investment going forward. Very good -- Bob thanks very time I know they're busy man in the markets and open any minute so thanks sought for taken timeout to -- -- for army aren't as bought Scherer he's a managing director at black rock investments joining us today on the financial exchange.