Wells Capital’s Jim Paulsen sees some short-term weakness ahead for stocks, leading him to recommend shifting some money from cyclical stocks into more defensive sectors.

Paulsen tells Bloomberg he thinks wages will start moving higher, and expects inflation and bond yields to rise. He thinks good economic news may, ironically, start to be bad for stocks as the year goes on, because it will be mean inflation concerns and concerns about potential alterations to the Federal Reserve’s tapering plan.

But while Paulsen sees some short-term weakness for equities, he doesn’t think investors should ditch stocks. In fact, he recommends remaining overweight on stocks, because he thinks a secular bull run should have years left to go. In addition to shifting some funds into more defensive areas, he also recommends diversifying into emerging market stocks, and some Japanese and European stocks.