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Forget Syria, market pause was due: Pro

Tuesday, 27 Aug 2013 | 1:03 PM ET
Forget Syria, market was due for a pause: Pro
Tuesday, 27 Aug 2013 | 12:05 PM ET
The stock market's recent decline was due because of fundamentals regardless of geopolitical risk, Josh Brown of Fusion Analytics says.

Stocks were headed for a correction regardless of geopolitical risk, Josh Brown of Fusion Analytics said Tuesday.

"That gorgeous 50-day moving average, which had been in an uptrend pretty much all year, is now flattening out, decliners versus advancers," he said. "That is a disturbing trend you don't want to see. And so I think what you're looking at right now is a continuation of this correction."

On CNBC's "Fast Money," Brown said that a down market wasn't cause for concern yet.

"It's perfectly healthy. There's nothing wrong with it," he said. "If people want to point to Syria today, they want to point to the debt-ceiling debate next week, whatever they need to do to explain this to themselves, but frankly the market had been tired. Earnings season has passed us. There were no other catalysts for a leg higher. So, right now we're in pause and you're seeing some of the safety assets take the reins."

Stocks traded lower midday, with the Dow Jones Industrial Average hitting a two-month low as the specter of U.S. military action in Syria loomed.

(Read more: US strike against Syria 'as early as Thursday')

OptionMonster's Jon Najarian noted that Secretary of State John Kerry's comments about the need for "accountability" over Syria's use of chemical weapons sent precious metals higher.

Futures Now: Gold enters bull market
The Futures Now team discusses movements in gold following news of upcoming U.S military action in Syria.

"You saw gold breach $1,400 as the speech was ending," Najarian said, adding that it was "not surprising."

Gold would likely continue to move up, he said.

TheStreet CIO Stephanie Link said that rising oil prices on Syria tensions would take a toll on transports and the consumer.

(Read more: Dennis Gartman: Get long gold, Nikkei)

"On the flip side, you can own the oil stocks because they are the beneficiaries," she said.

Link also noted that financials were "getting hammered today" as bond yields declined.

On the other hand, positive economic data from Japan, China and Europe on business sentiment and industrial profits provided a bright spot, Link added.

(Read more: Tesla in 'bubble territory': Stephen Weiss)

"So, I think that's the area on the margin where you want to be looking for opportunity to be buying," she said.

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

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