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Stock weakness is no reason to hit the panic button

Technicians seem to be ruling the day, after a 300-point drop in the Dow last Friday. The S&P 500 is hovering just above its 200-day moving average of roughly 2,061.

Earnings estimates have been coming down for the first and second quarters more quickly than normal, and not all of the weakness is due to the drop in estimates from energy companies.

As for earnings, I too have been concerned about the drop, but not so much that I am pushing the panic button. And neither are other market watchers.

Read MoreI won't be surprised by a stock correction: Siegel

Sam Stovall, U.S. equity strategist for S&P Capital IQ, noted over the weekend that full year GDP growth will likely be closer to 3 percent, rather than 2 percent, thanks to the improving economy. As a result, the current anemic 1.1 percent increase in earnings estimates for 2015 "will likely see a gradual uptick in estimates, similar to projected daily temperature highs for the East Coast in the weeks ahead."

One issue continues to concern me: the strength of the dollar. When the dollar is stronger, it does put pressure on earnings of companies with significant operations overseas. And when some companies experience a modest slowdown, the stronger dollar becomes an all-encompassing excuse.

Elsewhere:

1) Which is it: the oil supply going up or down? Goldman Sachs, in a note out over the weekend, sees supply up, saying "Our expectation going forward is therefore for the global crude inventory build to resume." The analysts then go on to say, "We expect Brent oil prices and timespreads to reverse their recent strength."

But OPEC Secretary General Abdalla Salem el-Badri, quoted in the WSJ, noted that a pullback in U.S. shale production could create a shortage that will push up prices even more. "If we don't have more supply, there will be a shortage and the price will rise again."

Read MoreUS crude to drop to $40 as stocks rise: Goldman

2) The European Central Bank launches its 1 trillion euro stimulus package today. That amounts to a purchase of 60 billion euros a month, of which 45 billion euros are sovereign bonds. Bond yields are down big today in Germany (19 percent!) and France (down 12 percent). The central bank is buying bonds based on the size of the economy and how much it contributes to the ECB. The big contributors would be Germany, France, Italy, and Spain.

  • Bob Pisani

    A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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