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Why did stocks get hit? Blame good—or bad—data

Stocks slid more than 1 percent on Tuesday for their worst day in a month, with all 10 S&P 500 sectors seeing downside. And for one trader, this is just the sort of downside moves we can now expect to see given current market valuations.

Given recent weakness in the economic data, investors are "getting their heads around" the fact that the current state of the economy is not "good enough to support a market that is trading at an 18 times multiple of forward earnings," said David Seaburg, head of equity sales trading at Cowen.

"We need to see topline growth start to really pick up, and that's only going to happen if we see economic data start to pick up to levels that are really more significant," Seaburg said Tuesday on CNBC's "Power Lunch." "And I don't mean, beat low-bar expectations, but really start to meaningfully uptick."

In the first quarter, S&P 500 companies' revenue declined by 2.9 year-over-year, according to FactSet's analysis of the reported earnings results. That's the biggest drop in revenue since the third quarter of 2009. And Seaburg says Tuesday's weak Dallas Fed Manufacturing number shows that economic strength won't soon lead to a revenue bounce-back.

Read MoreDallas Fed: Texas factory outlook slides to worst in 6 years

"You're really starting to see spotty economic data come through," Seaburg said. And "there's nothing really that's jumping off the charts to me to suggest that this economy can stand on its own two feet and support this multiple."

Conversely, others say stocks dropped Tuesday for precisely the opposite reason.

Citing positive news in the Case-Shiller home price index reading and the non-defense capital goods component of durable goods, Oppenheimer chief market strategist John Stoltzfus says that "it's a good-news-is-bad-news market today."

The positive news "perhaps suggests to nervous traders that the Fed could raise rates higher sooner than later. Also, good economic news and projections of higher rates on a stronger economy boosted the dollar, and it's not great for U.S. multinational earnings if the dollar reasserts last years' momentum," Stoltzfus wrote to CNBC.

But Stoltzfus says that continued moderate growth is no enemy of the market.

"We'll take the good news gladly. [These are] No boom times, but moderate growth should work for corporate America and Main Street just fine," he wrote.

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