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Market Will Move Higher Despite Rate Jitters: Analyst

Fritz Meyer, senior investment officer at AIM Investments, told CNBC’s “Squawk Box” that higher interest rates have spooked the market, but he remains optimistic.

“Several high profile Wall Street strategists threw in the towel on their Fed rate cut scenario,” Meyer said Thursday. “I think the consensus opinion has been shifting gradually and increasingly in the last few days toward the notion that ‘Maybe the Fed is stuck here, but maybe the Fed is getting prepared to raise rates.’ I think that has spooked the stock market.”

Meyer said it’s “difficult” to see a 10% market correction, but he noted history is “littered” with 5% corrections.

“I’d be surprised if we get even that much of a correction,” he said. “…I think we’re getting set up for another dramatic upside surprise in second quarter earnings in the United States. I think that is going generally unrecognized and unreported.”

At the end of World War II, 38% of Americans were engaged in manufacturing compared with 10% today – and the number continues to fall. He said this mutes the business cycle without sacrificing growth.

“Get broadly diversified and stay there and you’re going to do fine,” Meyer said. “Remember: Volatility in the stock market is what you get paid for. That’s why stocks have been terrific investments over time. Expect some volatility, but if we get a correction here, it will be a buying opportunity.”