“The S&P 500 is likely to retreat to 1,330 as sluggish domestic growth, high oil prices and Europe’s debt woes take their toll on US stocks, according to Kevin Cook, senior stock strategist at Zacks.com.
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“This market is building a wall of worry,” Cook told CNBC recently. “The train has left the station and left a lot of fund managers behind who wish they’d bought. They all want a pullback and that’s why we’re not getting it at the moment. A pullback will be bought even before 1,330 on the S&P.”
In a note, Cook identifies a number of what he calls “bricks for a wall of worry” that could contribute to a retreat of the S&P 500 [.SPX 1372.18 — UNCH 
] from the current levels, including a slowdown in the economy.
He believes that first quarter US gross domestic product growth could be close to 1 percent, as the 2.8 percent expansion seen in the fourth quarter of last year was largely due to inventory rebuilding.
Cook also says that the index could tilt downwards as earnings and sales forecasts at US companies become flat.
“These and other factors make a good wall for markets to climb near-term,” Cook said. “I’m a buyer of 3-6 percent pullbacks to S&P 1330 and 1300.”
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