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Don’t overreact to political uncertainty, but it's time to get defensive, market expert says

Jittery investors shouldn't overreact to the uncertainty surrounding the Republican health-care bill, but it is time to get defensive, market expert Chad Morganlander told CNBC on Thursday.

Stocks closed lower on Thursday after the vote on the legislation was delayed.

"The reality is that we've had this tremendous move within the overall financial markets and we would at this point in time potentially shift to more defensive companies. We believe that valuations at this point don't really make all that much sense," the portfolio manager at Washington Crossing Advisors said in an interview with "Closing Bell."

Investors hopeful about President Donald Trump's promises of tax reform, deregulation and fiscal spending have helped push the market higher since the election.

However, Trump's first order of business is repealing and replacing the Affordable Care Act, also known as Obamacare. Republicans are nowworking on mustering enough support for their health-care bill, which was originally expected to go to a vote on the House floor Thursday night.

However, while policy and the expectations and uncertainty surrounding it is certainly a driving force behind the market, it isn't the only one, Gabriela Santos said.

Equities are also being fueled by earnings and economic growth — and they still look solid, the global market strategist at JPMorgan Funds told "Closing Bell."

"Where we want to be positioned going forward for the rest of this year, really, are in the cyclical sectors that are positioned to benefit from growth and that has not changed," she said.

While Santos doesn't necessarily think that the economy can break away from 2 percent growth, she thinks it is enough to sustain mid-single-digit earnings growth, especially for cyclical companies.

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