With the Nasdaq in correction and the S&P 500 and Dow Jones over 8% lower from their previous highs, investors are divided. Some analysts see a buying opportunity, while others urge caution amid tariff uncertainty.
What Happened: The U.S. stock market has declined this week except for a bout of respite on Wednesday. This has followed Nasdaq’s entry in correction zone last Thursday. While most analysts have been positive, seeing a buying opportunity amid the fall, some continue to be cautious.
Analysts That See Buying Opportunities
Scott Wren, the senior global market strategist at Wells Fargo Advisors said that the firm has been advising investors to exercise patience and wait for opportunities to buy equities on pullbacks. He wrote, “The opportunity has arrived with the current pullback.”
“We see the current pullback as an opportunity to add exposure to equities and suggest that clients bring their U.S. Mid-cap exposure up to a favorable (overweight) allocation relative to their strategic (long-term) target weighting. Our large capitalization (SPX-type) rating remains favorable,” he said.
Meanwhile, acknowledging how “unsettled” investors were, the billionaire investor and the founder of Baron Capital, Ronald S. Baron spoke about the current market level and said that he “can’t believe how cheap stocks are.”
According to Alex Tsepaev, the chief strategy officer at B2PRIME Group, the markets have experienced similar or larger corrections nearly every year, indicating this decline could simply reflect normal market fluctuations rather than signaling deeper trouble.
“Investors should watch key economic indicators closely, but a pullback alone isn’t necessarily a sign of an impending downturn—it’s more likely part of a regular market adjustment,” he said.
Charlie Bilello, the chief market strategist at Creative Planning reiterated in an X post that the S&P 500 index has returned an average of 10% per year since 1928 despite an average intra-year drawdown of 16%.
Similarly, Mona Mahajan, the investment strategist at Edward Jones stated in her note, “Keep in mind that in any given year, one to three pullbacks are normal, in the 5% to 15% range, and historically these have led to buying opportunities.”
Analysts Warranting Caution
As some of President Donald Trump‘s tariffs have gone into effect, the remaining “reciprocal tariffs” will be levied on April 2nd. While tariffs are one of the factors causing uncertainty in the markets, economist Jeremy Siegel cautioned investors to stay away from “aggressive buying”.
“I expect continued volatility, with sentiment swinging on headlines. While there’s potential for a rebound, the market valuations are elevated versus history, so there isn’t a strong incentive for aggressive buying just yet,” he said.
Billionaire Ray Dalio, while speaking at the Converge Live conference hosted by CNBC in Singapore, said that the current pullback was not because of tariffs or Deepseek, but because the stock market price is affected by the present value of future cash flows. “It’s going down because of concerns of the present value of the discounted cash flows,” he said, hinting at higher valuations.
Howard Marks in his latest memo, ‘Gimme Credit,’ endorsed debt investments over S&P 500. “The current level of offered yields implies higher returns from credit than the S&P 500, with returns that are contractual and thus subject to much less variability and uncertainty,” the memo stated.
Why It Matters: As of Wednesday’s close, the S&P 500 index was down 8.92% from its 52-week high, whereas the Dow Jones Industrial Average was 8.26% lower from its previous high.
Both the Nasdaq 100 and Nasdaq Composite indices were in the correction territory with the former down 11.82% and the latter 12.65% below their previous highs.
The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, rose on Wednesday. The SPY rose 0.53% to $558.87, and the QQQ also advanced 1.13% to $476.92.
As of Thursday’s premarket, SPY was down 0.51% to $556.00 and QQQ declined 0.71% to $473.53.
Read Next:
Photo courtesy: Shutterstock
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
