Another market pullback would be 'constructive,' strategist says

BMO Private Wealth chief market strategist, Carol Schleif, joins Morning Brief with Yahoo Finance Senior Reporter Allie Canal to discuss the recent market (^DJI, ^GSPC, ^IXIC) pullback and explain why she thinks this could actually be productive long term.

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Video Transcript

00:00 Speaker A

This week's tech sell off has many wondering whether overvaluation concerns have finally hit a boiling point and if we're now seeing the end of a bull market that's been chugging higher since April. For a deeper dive, let's bring in Carol Schleif, BMO Private Wealth Chief Market strategist.

00:15 Speaker A

Carol, there there's been a lot going on the past few weeks, a lot of talk of a market bubble, whether we've hit the peak in the bull market. How concerned should investors be with this latest sell off? Because a lot of strategists have also been telling us that a pullback was coming sooner than later.

00:30 Carol Schleif

Right. Well, a pullback would be normal, especially when you look at the energy that's been deployed coming off of those April lows. So some sort of a pullback in here would be natural.

00:40 Carol Schleif

It's important though, and the one thing that the markets have done very well all year is they might freak out a little bit in the short run, but they keep pulling back to what those fundamental threads, the underlying fundamentals are. And the underlying fundamentals remain pretty solid overarchingly, and we've seen that with tech tech company earnings, with other company earnings that were coming into the season so far with something like two-thirds of the S&P having reported, we're talking double digit bottom line earnings growth, which is pretty amazing for this far in the cycle.

01:09 Carol Schleif

And so a pullback would be normal, the underlying fundamentals remain there and actually a pullback I think would be constructive in here because it allows markets to reset. They had kind of run ahead of of things as markets are want to do.

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