Market could see 5 percent pullback, pro says

U.S. stocks tumbled Wednesday, dropping more than 1 percent after crude declined to a new five-year low, and at least one market pro thinks shares have further to fall.

"We've had a pretty good run off the low in October and it doesn't surprise me right around mid-December we have a pullback," Morgan Stanley's Andrew Slimmon told CNBC's "Closing Bell."

"Will we have the same level? No. But could we have a pullback of 5 percent? I think that's a real possibility."

Quantitative Management Associates' Ed Keon suspects this is a short-term pullback.

"We'll head back up again pretty soon," he said.

Read MoreStocks close down 1.5% on oil decline; Energy drops 3%

While the drop in oil in the short run hurts overall earnings for the S&P 500 and creates uncertainty, in the long run it is good news for the U.S. economy, Keon noted.

"By having lower oil prices and a stronger dollar, you get less … upward pressure on inflation. You keep interest rates lower; that should be good for valuations as we go into 2015."

The Dow Jones industrial average fell more than 280 points before recovering some of those losses to trade about 270 points lower. It was the index's worst day since Oct. 9.

Read MoreFear indicator spikes as traders get 'skittish'

Veteran trader Art Cashin, director of floor operations for UBS, told CNBC a great deal of the decline in the market was due to fears about oil spilling into other areas.

U.S. crude futures for January settled at $60.94, after U.S. data showed a surprise jump in oil inventories and OPEC cut its demand outlook for global oil consumption.

"Today would have been a perfect day for the buy-the-dippers. … [That] didn't happen," he said. "That's because we're seeing early concerns about contagion; that it's beginning to spill over into other assets," Cashin said.

"They're not worried enough to put on the hazmat suits yet but you can see that they are concerned about contagion."

That said, "Fast Money" trader Brian Kelly thinks oil is nearing a bottom.

"I think WTI around $60, that's where it finds support. You are also getting some of the shale oil producers cutting the drilling applications so somewhere close to here you have a bottom in oil," he said.

Read MoreWith $60 oil, expect some US shale restructuring: Analyst

However, he's not sure what it means for the U.S. stock market since low oil prices have been viewed as a tax cut for consumers, which drives spending.

"What happens if oil goes up now, does that mean it's a tax increase? I am less bullish on the U.S. stock market," Kelly said.

However, CNBC contributor Stephanie Link still likes the U.S. market because "the U.S. economy is on pretty good footing."

"The speed of the oil decline is certainly troubling, that is absolutely the case, but I still think the U.S. is the best place to be. The U.S. is still seeing strength," she said.

—CNBC's Kate Gibson contributed to this report.