While Thursday saw global markets drop, that was just colossal fears of a recession, Jim Paulsen, chief investment strategist at Wells Capital Management, told CNBC's "Power Lunch."
Amid the decline, the Dow Jones industrial average shed more 300 points in intraday trading before regaining some ground. While West Texas Intermediate crude settle down 4.5 percent, investors sought a safe haven in gold, which surged more than 4 percent.
Despite a sharp drop in stocks Thursday, Paulsen contends equities may be close to a bottom.
First, there's been a revaluation in the past 15 months, the strategist said. "We were selling probably 19 times trailing earnings at market peak," Paulsen said. "We are selling now at about 16 times trailing earnings," he noted, adding that the latter is a more sustainable multiple.
Second, Paulsen thinks that out of three almost 10 percent corrections since late 2014, this is the only one that has driven investors to safety.
Some economists may think that policy rhetoric could be the catalyst that soothes market fears, but Paulsen "think[s] we are going to get better economic data out of the United States" instead. "If we do that, we probably get a pretty good rally," he told "Power Lunch."
In the scenarios that the market finds a bottom and rallies, there will be a new leadership change, he said. "I think it's going to be more orientated on the producer side of the economy ... rather than the consumer side," Paulsen said.
Market watchers remain skeptical, however, that stocks will see a bottom, as worries about global economic health continue to grow.
Fed Chair Janet Yellen appeared for her second day of the semiannual congressional testimony on Thursday. "There is always some chance of recession in any year," she told senators. "But the evidence suggests that expansions don't die of old age."
In this same vein, Paulsen thinks that a recession in the U.S. is unlikely. "We're not going to have a recession in the U.S.," he said. "I would say the data has gotten a little better; look at that claims number we got this morning."
U.S. weekly jobless claims came in at 269,000 Thursday, which was below estimates. "The data will not support recession," Paulsen said.
Similarly, billionaire investor Mark Cuban told CNBC on Thursday that he's "not really seeing any type of softness at all. We're continuing to hire; we are having challenges hiring at the higher end, like everybody is. There is lots of open jobs."
— CNBC's Fred Imbert contributed to this article.