There are growing signs a market correction is coming, and September is often a common time for one

Published Thu, Aug 19 20219:52 AM EDTUpdated Thu, Aug 19 202110:28 AM EDT

Patti Domm @in/patti-domm-9224884/@pattidomm

After a summer of rapid fire new market highs, some strategists see growing signs a stock market correction is coming, and September has historically been a common time for one. Stocks have already been jolted this week, as concerns about the Federal Reserve's move to cut back on its bond purchases rattled investors. Stocks slid again Thursday morning , after the S & P 500 fell 1.1% Wednesday for its worst performance since July 19. The S & P 500 is down more than 1% for the week, and off by nearly 2% from its record. Strategists point to concerns about inflation, the Covid-19 delta variant, the Fed's plan to taper bond purchases, a consumer slowdown and, most recently, geopolitical risks in the aftermath of the the pullout of U.S. troops form Afghanistan. The calendar will also soon roll over to September, which is historically the worst month of the year for the stock market. It is also a time when many strategists say it would be better to shift into value and cyclicals over growth and large-cap tech. "What poses risk for the market is that sentiment levels are high, valuations are high and it's been on a tear of late," Richard Bernstein Advisors deputy chief investment officer Dan Suzuki said. "And at the same time, there are a lot of potential catalysts that could get the market worried. "If you just think about over the last week or so, we've gotten a worsening narrative on pretty much all fronts, whether you're looking at the geopolitical tensions due to Afghanistan, you're looking at the Covid infection rates, or the rate of growth in the U.S.," Suzuki added. "Everything has been incrementally negative." Given how expensive the market has become, Suzuki said it is easy to see a 10% correction, but he's not expecting a major sell-off. Melt down or melt up? BTIG head of equities and derivatives strategy Julian Emanuel said his base case is for a correction down to about 4,000 on the S & P 500. The S & P 500 closed at 4,400 on Wednesday, off its latest high of 4,480. He al