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Sell stocks—they’re tremendously vulnerable: Investor

The S&P 500 closed out its best week of the year Friday, rising 3.27 percent. However, one investor is still very wary of the remarkable gains.

Chad Morganlander, portfolio manager at Stifel Nicolaus' Washington Crossing Advisors, recently went underweight the S&P, given the slowdown in corporate earnings and revenue.

"We believe that earnings growth is going to be lackluster in 2016 ... that's on the back of lackluster revenue growth," Morganlander said Friday on CNBC's "Power Lunch."

With 95 percent of companies having reported earnings, profits have fallen almost 2 percent in the third quarter and are expected to decline again in the fourth quarter, according to FactSet. Reported revenue has also dropped for three consecutive quarters, and is expected to fall in the fourth quarter as well.

Read MoreQ3 earnings look the most dismal since financial crisis

Meanwhile, Morganlander expects global growth to continue to slow, and for problems to persist into 2016.

"As global growth decelerates, it provides a tremendous amount of vulnerability for investors. So this technical bounce here should be sold," he said.

However, technician Craig Johnson of Piper Jaffray said the S&P just had a very important technical week, and he remains bullish on equities.

"We came right back down to the zone of 2,020, 2,040, found good support and have rallied off of it. I think we're setting ourselves up for a strong move into year-end," Johnson said. "We think it's going to continue on into 2016."


Johnson reiterated his 2,135 year-end target on the S&P 500, which would be a 2 percent increase from where stocks closed Friday.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Sara Eisen

Sara Eisen joined CNBC in December 2013 as a correspondent, focusing on the global consumer. She is co-anchor of the 10AM ET hour of CNBC's "Squawk on the Street" (M-F, 9AM-11AM ET), broadcast from Post 9 at the New York Stock Exchange.

In March 2018, Eisen was named co-anchor of CNBC's "Power Lunch" (M-F, 1PM-3PM ET), which broadcasts from CNBC Global Headquarters in Englewood Cliffs, N.J.

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