Analyst Says Market To Be Volatile, Could Break 12,000

Eugene Peroni, senior manager of equity research at Claymore Advisors, told CNBC’s “Squawk on the Street” that the Dow Jones Industrial Average could fall below 12,000.

“I think it’s very plausible,” he said Wednesday. “The fact that we have had the second test of the lows that we saw at the start of March is significant -- there’s more to be shaken out of this market before we really hit a good bottom and have a sustainable, reliable recovery.”

Peroni said he expects market technical indicators to be weak for the next one to three months and the market will react to news and world events.

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“When the market is reactive to headline news or old news that’s when I think it’s vulnerable,” he said. “…I’d be nibbling. It’s hard to call the bottom, but a break below 12,000 and I’d get more aggressive in my buying.”

He suggested taking a look at selected stocks in medical devices, materials, big pharmaceuticals and oil and gas field services.