While the Dow Jones industrial average was only in a correction ahead of Friday's trading, the carnage in small cap stocks has been much worse. "You could argue we're in a stealth bear," said Jurrien Timmer, director of global macro research at Fidelity Investments.
"If you look deeper within the market, the Russell 2000 is down [about] 22 percent from its high. That's bear market territory," Timmer told CNBC's "Squawk Box" on Friday. "The markets are very oversold, extremely oversold. As of yesterday, only 9 percent of stocks in the S&P were above their short-term moving average."
U.S. stock futures were tanking Friday morning, with Dow futures down more than 300 points, as oil prices dropped more than 5 percent. The renewed selling came a day after stocks and crude bounced higher.
But Timmer sees hope coming later in 2016. "This is going to be a first half of the year versus the second half of the year, where I think we're setting up for a very big 'V' bottom, the way we saw in 2009, only this time in the beaten-down sectors like energy, emerging markets, and commodities."
Timmer's comparison to 2009 referred to the stock bottom made that year after a precipitous drop from the late 2007 highs during the financial crisis. Bouncing off that March 2009 bottom, the bull market since then experienced just three corrections, including the one at the start of this year.
Earlier Friday, BlackRock Chairman and CEO Larry Fink told "Squawk Box" he also expects a second half of the year turnaround, but not before what could be another 10 percent to the downside for stocks. "I believe there's not enough blood in the street. We'll probably going to have to test the markets lower."