Weak Q1 earnings will be brief speed bump, market watchers say

First-quarter corporate earnings will likely prove sluggish, but they should drag on stock markets only briefly, said one analyst Friday.

"The good news is they probably don't get a lot worse than they are right now and the comparisons may actually get better," John Manley, chief equity strategist at Wells Fargo Fund Management, said in a CNBC "Power Lunch" interview. "I think that's important to remember because I think the market tends to look forward in these things," he said.

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A strong dollar and cheap crude oil's effect on the energy sector have raised concerns about weak U.S. first-quarter earnings. The concerns mounted Friday when the Commerce Department estimated that after-tax corporate profits fell by 1.6 percent in the fourth quarter of last year.

Corporate New York skyline
Scott Mlyn | CNBC

If disappointing quarterly earnings—many of which will be reported in April—prompt a stock market hiccup, the effect should be limited, Manley said.

Bigger picture, he believes Federal Reserve policy is "the single most important factor" for markets. As the U.S. central bank has hinted it will use caution in normalizing rates, money will continue to flow into U.S. markets, Manley said.

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Rob Lutts, president and CIO of Cabot Wealth Management, added the U.S. is firmly in a bull market. Commenting during the same "Power Lunch" discussion, he said the Fed is likely to take its time—probably until late this year—to raise interest rates.

Lutts argues stocks remain undervalued, and his firm believes the S&P 500 will move 20 percent higher this year. The index is nearly flat this year.