Why Was Today's Stock Market Selloff So Steep?

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May 15 (Bloomberg) -- Stifel Nicolaus' Chad Morganlander and Westwood Capital's Dan Alpert discuss the selloff in the U.S. stock market with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

Nicolaus.

Is there any particular reason you are ascribing to today's selloff?

Geopolitical concerns, perhaps concern about second-quarter growth, considering the fact that the first quarter was an absolute disaster.

Besides that, much of that is perhaps what contributed to it.

Earnings growth also is potentially a concern.

We have valuations at this point based off of our estimate of 115 dollars in earnings for the s&p. the market is trading around 16 times forward multiple, so it is not particularly cheap.

Daniel alpert, is the economy that the federal reserve and janet yellen are watching different than the economy that stockmarket investors are watching?

The stock market is also looking at the bond market right now, and it has been rallying enormously.

Yields have dropped.

Yields were over 3% on the 10 year, and they touched down below 2.50% today.

That is a message focused on issues such as global deflation, which you have seen again in europe today.

We saw very bad numbers come out of europe on the gdp side as well.

Industrial production in the united states.

Industrial production in the united states, but beyond just to mr.

Numbers, which are mixed -- frankly, you're getting good news and bad news -- beyond just domestic numbers, the fact is if you look at what is going on globally in the world, we are still dealing with this fundamental issue of excess supply and insufficient demand both in the united states and in europe.

Europe was expected to rebound faster.

The bond market reacted to that and is reacting to the prospect of the ecb cutting interest rates as well, so that makes u.s. bonds more attractive.

Chad morganlander, we just had record highs for the dow jones industrial average.

We have just seen stocks move higher this week.

Is this important of a bigger selloff?

You know, look, we had a pretty good down payment on future growth last year with the 30% return.

Five percent to 10% correction in the market would not shock any of us considering the fact that the federal reserve is curtailing that liquidity program.

Nonetheless, we believe that global growth is moderating or decelerating.

We believe u.s. growth will accelerate and earnings growth will be up.

Our forecast is that, yes, you can get a little selloff, but total return in the equity markets around 7% to 8% this

This text has been automatically generated. It may not be 100% accurate.

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