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A 'perfect storm' correction is coming, and nothing can stop it: Rosenberg

A sharp stock market pullback is imminent, according to David Rosenberg, chief economist and strategist at Gluskin Sheff.

On Friday, stocks were hammered by fears the Federal Reserve might hike rates sooner than expected, sending the S&P 500 index and the Dow Jones industrial average into a tailspin. According to Rosenberg, there's more trouble ahead.

"You have a perfect storm here if you get something like a Fed rate hike into the next several months," Rosenberg said Thursday on CNBC's "Futures Now. "The problem is that the market is not priced for it. I wouldn't be surprised that we see some kind of repeat as we had towards the end of last year into January-February, which was something close to a 12 percent correction."

Rosenberg, who has been named to the U.S. Institutional Investor All-America All Star Team several times in his career, doesn't think the shake-up can be avoided.

His reasoning doesn't just include a potential Fed rate hike. He also takes into account a more richly valued stock market, signs of investor complacency and a sluggish U.S. economy.

"We entered into the third quarter with momentum and a lot of hope, and now we're exiting the third quarter," he said. "And, let's face it: The last five or six [economic] numbers have been really soft," he contended.

"The problem now, looking at where the market is priced, you've got cycle high multiples, you've got a lot of hedge funds in the futures options market that have been chasing performance here up to the price highs, and it doesn't take much in the way of any sort of near-term adverse news to cause the market to correct."

Trump presidency 'good' for the market

On average, September, which is historically the worst-performing month for stocks, only sees positive returns about half the time. In the fourth quarter, the S&P 500 has fallen more than 10 percent just once in the past 20 years.

But, there's also a market wild card to watch this season: Uncertainty revolving around the presidential election.

Rosenberg says a Donald Trump win could hurt the market near term, but added that he thinks a Trump victory would actually be "pretty good for the U.S. economy down the road."

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