Sep. 30--It's been so long since the market and economy have been "normal" that most investors won't remember what it truly feels like.

Bob Doll remembers, however, and he says a return to normalcy is coming. Doll is the global chief investment officer for equities at BlackRock and a veteran Wall Street observer -- the kind of guy an average investor would like to chat with during uncertain times like these.

In recent commentaries, Doll has said that the market and economy are "slowly getting back to normal." But with no definition for what constitutes "normal," he acknowledges that investors no longer know what it feels like.

"While we're not going back to the abnormality that existed prior to the credit crunch -- meaning easy money, lots of borrowing, etc. -- I'm also saying we're not in the environment of looking into the big black hole wondering when we're going to recover," Doll said.

"We're going to have an economy that's growing around trend growth, defined as around 2.5 percent to 3 percent real growth in the gross domestic product," he said. "We'll have a consumer who is participating, not in a crazy way but nor is he or she under the table struggling to breath because of the noose of credit around their necks.

"We have profits that are generally moving up, we have markets that are doing their normal thing, meaning more days when they go up than down. That's the real economy and, before you get there, you have to have the financial markets or the financial machinery

that underscores and powers our economy acting more normally and that's pretty well along."

Doll believes investors should move forward like they expect a return to historical norms, neither the go-go gains of the late 1990s nor the tragedies of a year ago. And he believes that reports about the death of diversification, asset allocation, buy-and-hold strategies and more are greatly exaggerated.

Doll has a few investment ideas for a diversified portfolio, including seven stocks in three sectors.

"I would have some cyclicality in the portfolio, and my favorite sector for that is energy," Doll said. "I'd pick an integrated company like ConocoPhillips, I'd pick an exploration production company like Anadarko Petroleum, and I'd pick an oil-services company like National Oilwell Varco."

"I want some defensive stocks in the portfolio," he added. "My favorite sector there is health care, so there I might think about a pharmaceutical. There are four big pharma companies that are about to become two over the next couple of months." You could buy "any of those -- Wyeth is one of my favorites for that part of the portfolio -- in biotechnology, Amgen is an inexpensive stock and, I think, in the heat of health-care reform, the health-care service segment presents an interesting risk-reward. UnitedHealth Group is a way to play that."

"Finally," Doll said, "I want some growth in my portfolio and technology is, I think, the best sector primed for growth. IBM, believe it or not, is a misunderstood company and despite having done pretty well in the market has more appreciation in front of it."

As for investing in segments that have suffered since the year of the Lehman Brothers collapse, Doll said he's underweight on financial-services stocks, noting that while he expects financials to continue participating in the market's recovery, he believes they will do "less well than the market overall."

Chuck Jaffe of MarketWatch can be reached at cjaffe@marketwatch.com or at Box 70, Cohasset, MA 02025-0070.

-----

To see more of the Tulsa World, or to subscribe to the newspaper, go to http://www.tulsaworld.com.

Copyright (c) 2009, Tulsa World, Okla.

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

NYSE:BLK, NYSE:COP, NYSE:APC, NYSE:NOV, NYSE:WYE, NASDAQ-NMS:AMGN, NYSE:UNH, NYSE:IBM, NYSE:LEH,

A service of YellowBrix, Inc.