The Dow Jones Industrial Average will finish next year at around the 15,200 level—11.5 percent below Monday's close, the managing director at Southwest Securities told CNBC on Tuesday.
"Stocks are going to be in trouble for a while," Mark Grant said, citing the stumbling economies in Europe and Asia and his expectation of a slowdown in U.S. growth.
If oil prices ever drop to $30 a barrel, he added, "all bets are off" because America would be in deflation "like everybody else." But he doesn't expect oil to go that low, predicting a bottom in the mid-40s.
Read MoreOil could drop another $15 from here: Analyst
The wildcard of oil prices has shaken the resolve of even the staunchest stock market bulls.
Wharton School finance professor Jeremy Siegel told "Squawk Box" last week that while he's still positive on stocks for next year he expects a correction—defined by a 10 percent drop from record highs.
Thomas Lee, founder of Fundstrat Global Advisors, recently said he's still optimistic about the prospects for the economy and stocks in 2015, but predicted a more pronounced divergence in sectors, making picking winners more challenging next year.
Meanwhile, the strengthening dollar and its potential impact on corporate earnings should be a concern for investors and the Federal Reserve, Grant said Tuesday, as the central bank opened its final meeting of the year with all of Wall Street looking for hints on when policymakers might start increasing interest rates next year.
Many central bank watchers still see a move in the second half of 2015, according to the latest CNBC Fed Survey, despite plunging oil prices and signs of a strengthening economy.
Read MoreFed on track to raise rates this summer: Survey
But Grant said on "Squawk Box" he sees it differently.
"America is not an island sitting between Europe and Asia," he said. "I think our economy is only doing well at the moment and is going to be hit by all this in the first quarter of 2015 because all these statistics lag."
He thinks the Fed won't increase rates at all next year.
That's why Grant sees lower bond yields. He said the next step down on the 10 year Treasury yield, hovering above 2 percent Tuesday, would range from 1.5 to 1.75 percent.
Early in 2014 when 10 year yields were around 3 percent, many analysts were predicting increases. But at the time, Grant predicted a decline, which proved a correct call.
"If you look at the long bond for this year, the long 30-year boring U.S. Treasury bond including the coupon, it's returned 28 percent from January 3 to today," he said Tuesday. "Now how good is that?"
On "Squawk Box" earlier this month, BlackRock Chairman and CEO Larry Fink said he saw bond yields under pressure in the short term. But in contrast to Grant on stocks, Fink predicted gains.