Wall Street bull Edward Yardeni isn’t sure how much longer investors will shrug off coronavirus fears.
He sees the outbreak as the most critical risk to the record stock market rally.
“That’s all I really see,” the Yardeni Research president told CNBC’s “Trading Nation” on Friday. “The longer that this virus threat continues to weigh on the global economy, the more it poses a risk for at least a correction in the stock market.”
A correction is a decline of at least 10% from recent highs.
Yardeni, who spent decades on Wall Street running investment strategy for firms including Prudential and Deutsche Bank, came into the year on pullback watch. Even though he’s a long-term bull, Yardeni believes stretched market valuations have been increasing correction risks for months.
According to Yardeni, coronavirus fears could emerge as the catalyst that puts the record rally on pause.
“The markets have done remarkably well in the face of headline news that’s still unsettling like cruise ships being quarantined and China basically being completely quarantined because of cancellations of flights,” he said. “That’s got to be disruptive for supply chains.”
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