Expect 5-10% Correction From Here: Portfolio Manager
Stocks opened higher on Wednesday, with banks rebounding after a sharp selloff in the previous session after both Greece and Portugal had their debt ratings downgraded. Howard Ward, portfolio manager at Gamco Growth Fund, shared his insights.
“If you look back over the last 14 months, the S&P 500 rose almost 80 percent and the Dow has been up every week, so the market was extended going into this concern about Greece, Portugal and contagion,” Ward told CNBC.
“We can have another 5 to 10 percent pullback from here and the S&P will still be very near its 200-day moving average.”
Ward said investors should expect some consolidation going forward.
“The market is turbulent and there’s no need to jump in, because this market is not going to race away to the upside,” he added.
Ward said he is concerned over the European crisis in the short-term because the EU has “procrastinated” in coming to grips with how to resolve the Greek issue.
“They’ve lost credibility and we’re seeing a real-time stress test of the architecture of the EU,” he said. “If anything is timely today for investors, it’s gold—you have currency chaos that points you to gold.”
Watch Ward's Previous Appearance on CNBC (Apr. 5, 2010)
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No immediate information was available for Ward or his firm.