Market ‘a little bubbly,’ but pullback coming, expert says

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With the earnings propelling equities to new highs, investors will have to wait for an opportunity to get into the market, experts told CNBC on Monday.

The Dow Jones industrial average notched its ninth straight record close Monday, ending up 25.61 points at 22,118.42, amid a stronger-than-expected earnings season.

“Earnings have been getting better and better,” trader Peter Costa said. While he’s not buying into the market now, he also stopped shorting it.

“There is going to be some sort of pullback. It’s just natural. It’s part of the evolution of a bull market,” the president of Empire Executions said in an interview with “Closing Bell.”

“On a pullback, I will be back in the market because I do think going forward to 2018, I think the market is going to do a lot better next year.”

Chris Johnson, CEO of Johnson Research, also sees a bit of a correction in the cards. Right now, traders are “buying the rumor and selling the news” when it comes to earnings — getting in before earnings are announced, and then taking profits on the results, he said.

“At some point the earnings scale is going to tip a little bit. We’re going to get a bit more of a correction. That’s going to be the time to start getting in. This market is still a little bubbly,” Johnson told “Closing Bell.”

John Blank, chief equity strategist at Zacks Investment Research, pointed to the number of companies that are beating expectations this earnings season. The average beat ratio is at a “record high” of 60 to 65 percent, he said.

“You’ve got this underlying strength that is so broad-based and we haven’t seen that and that’s what’s keeping this market aloft in this very steady upward trending motion. It’s all based fundamentally on fundamentals,” he told “Closing Bell.”

Louis Navellier, founder and chairman of Navellier & Associates, called the earnings environment “stunning.” He’s especially waiting for Nvidia, which is scheduled to report Thursday.

“We should count on that to carry the whole market higher,” he said in an interview with “Closing Bell.”

Nvidia hit a new all-time high on Monday.

— CNBC’s Fred Imbert and Pippa Stevens contributed to this report.

[“Source-cnbc”]