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TRADING NATION
The S&P 500 is having its worst month in nearly three years.
Small-cap stocks are getting hammered
But the worst may be yet to come for the stock market, according to — three experts debate what to do next
Jim Paulsen, chief investment strategist at Leuthold Group. The small-cap Russell 2000 index has seen
better days. The group of stocks has fallen into a
correction, and is currently on track for its worst
"My guess is that we're going to have a bigger correction than we've month since January 2016. Here's what three
experts have told CNBC in the last week about
had yet," said Paulsen on CNBC's "Trading Nation" on Friday. the move.
"I don't think we can handle that environment at 20-some-times Beaten-up tech stocks to feel more pain, investor Paul
Meeks predicts
trailing earnings, probably more like 15 to 16 times trailing earnings
Housing stocks are having their worst year since 2008,
and we're a ways from that," the investor added. and some see even more distress
Five experts weigh in on Netflix's blockbuster earnings
The S&P 500 currently trades at 19 times trailing earnings, one of beat
its highest multiples in the past decade. High-growth sectors Cloud stocks like Adobe and Workday are surging, and
some say the best is yet to come
including technology and consumer discretionary trade, with a Dow jumps more than 500 points, posts best day since
multiple above 20 times trailing earnings. March as earnings fuel rally
"It's probably time to get more defensive and not have as much
VIDEOS ›
octane on from here as you have earlier in this bull market," said
Paulsen, highlighting safety sectors such as utilities, staples, and real Investors may want to consider
getting defensive, Jim Paulsen
estate investment trusts (REITs) as good bets in this environment. says
Jim Paulsen, chief investment strategist at the
Defensive stocks have already taken the lead in recent months. The Leuthold Group, discusses his latest market
outlook with Mike Santoli.
XLP consumer staples ETF and the XLU utilities ETF have rallied
more than 3 percent over the past three months, while the XLK
Amazon, Microsoft and Alphabet
technology ETF and XLY consumer discretionary ETF have fallen by
are about to report earnings. Here’s
at least 3 percent. what to expect
Bill Baruch of Blue Line Futures and Mark
Tepper of Strategic Wealth Partners discuss the
big week of tech earnings ahead with Mike
Santoli.
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Stacey Gilbert
Stacey Gilbert is the head of derivative strategy
at Susquehanna.
Paulsen said a hard turn in the market, to favor defensive stocks over
cyclicals, suggested economic trouble ahead, too.
Lawrence McDonald
Managing Director, ACG Analytics
"If defensive stocks are taking leadership, what's that say about
upcoming economic growth?" he asked. "I think it suggests that
economic growth is going to slow more than Wall Street really is Rich Ross
ready for." Managing Director, Head of Technical Analysis,
Evercore ISI
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10/22/2018 A 15 percent correction is the gut check the market needs: Jim Paulsen
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10/22/2018 A 15 percent correction is the gut check the market needs: Jim Paulsen
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