The forthcoming trading sessions will show whether investors are basing their plays on liquidity or fundamentals, Allianz's Mohamed El-Erian said.
"Yes, some people are not able to go back to work. ... But there are others that are not willing to do so," the chief economic advisor at Allianz told CNBC.
"If you want capitalism to be sustained, you need buy-in from a lot of people. You cannot get buy-in if it's all about large corporations," economist Mohamed El-Erian told CNBC on Thursday.
"I think what derails this market isn't more China-U.S. tension, isn't more political differences. It would be if we get then large-scale bankruptcies," the chief economic advisor at Allianz added.
"The big question is, what is the next anchor for markets? And it's not clear to me where that's going to come from," Allianz's Mohamed El-Erian told CNBC on Thursday.
The Dow Jones Industrial Average is now positive three weeks in a row for the first time this year. Since 2010, similar Dow rallies have most often presaged more stock buying rather than selling.
The economist, who in early March correctly called a coronavirus-driven bear market, told CNBC he's reluctant to buy the recent reopening rally.
Real-time data showed businesses and households were reengaging in the economy, said the Allianz chief economic advisor. "The big hope is we sustain it."
Wall Street is watching for positive signs as states and cities begin to reopen from Covid-19 lockdowns. Five market experts weigh in.
"My own sense is the Fed went too far in going into the high-yield market," the Allianz economic advisor told CNBC on Monday. "You get people who shouldn't be borrowing raising money."
"I'm a little bit more worried than what the consensus of economists out there is right now," Mohamed El-Erian told CNBC.
"You don't want to say, 'Hey look I'm doing OK'" while millions and millions of Americans just lost their jobs. economist Mohamed El-Erian told CNBC.
The billionaire entrepreneur and "Shark Tank" investor said Monday that the recently launched small business loan program has been beset by challenges.
"I've always said it's a medical solution that forms a bottom for this market," economist Mohamed El-Erian told CNBC.
"I don't think we're forming a bottom yet. I think we're going down at a slower rate," Allianz's Mohamed El-Erian said Friday.
"Whatever cash you have, divide it over five installments," Mohamed El-Erian told CNBC on Wednesday, suggesting dollar-cost averaging into the market over several months.
The economist said the sell "everything" moment has passed, but he cautioned against rushing into stock indexes.
The stock market's steep decline over the last month has now created opportunities for investors who can stomach risk, economist Mohamed El-Erian said.
He said the Fed wasted a large part of its monetary policy arsenal to fight the economic fallout of the coronavirus.
"By probably next week, we'll be at capacity of tens of thousands of tests a day," former Food and Drug Administration Commissioner Scott Gottlieb told CNBC.