Market wreckage will spark 'tremendous opportunities' for investors, Prudential Financial's Quincy Krosby predicts

Prudential Financial's Quincy Krosby has advice for investors: Let the stock market volatility work for you.

She's confident the market's wild swings will ultimately subside and generate strong upside.

"If the sell-off continues and it deepens, it's going to provide tremendous opportunities as the market settles down," the firm's chief market strategist said Monday on CNBC's "Trading Nation."

Stocks fell sharply Tuesday morning and the major indexes turned negative for the year.

Krosby isn't ruling out a retest of October's lows because of the uncertainty surrounding the market when it comes to Federal Reserve policy, the U.S.-China trade war and global growth jitters.

"If you have to go into the market now, we suggest you go into the defensive names," she said, highlighting health care, consumer staples and utilities.

Her thoughts came as the major indexes kicked off another the week in sell-off mode. The tech-heavy Nasdaq slipped deeper into correction territory. It was off 10 percent over the past three months as of Monday's closing. However, Krosby sees the wreckage in tech as an option for investors who have a strong risk tolerance.

"You may want to take a look at the ones that have been really beaten down," said Krosby. "Cloud is not going away. Cybersecurity is not going away. But nonetheless, they're going to have to probably sell off more as we see the tech names just basically being a source of funding perhaps for hedge funds right now. But this, too, shall pass."

For investors with a weak stomach for volatility, she notes that sitting on the sidelines isn't such a bad strategy either.

"If you can sit out and wait in cash, I think the opportunities are going to come to you," she added.

And, she suggests that could happen before the end of the year.

Not too late for Santa Claus rally?

According to Krosby, it's not too late for the markets to stage a Santa Claus rally. If the markets can muster the momentum, it's possible stocks could end the year higher than current levels — especially if the Federal Reserve indicates it will hike fewer than four times between now and 2020 and the U.S.-China trade tensions ease.

"Any headline that comes in and changes our perception of those two major, major issues for the market could actually underpin a stronger turnaround before the end of this month," Krosby said.


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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.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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