5 Reasons the Stock Market Is Headed for a Pullback - But Don't Sell Yet

The S&P 500 is above 7,500. The Nasdaq is up 16% this year. But beneath the surface, a 40-year Wall Street veteran counts five mounting risks.

1. Inflation is back. After cooling to 2.4%, the Consumer Price Index surged to 3.8% in April - the hottest in nearly three years. Oil jumped amid tensions with Iran. Gas is up 28% year-over-year; beef is up nearly 15%.

2. The Fed is on hold. The central bank has kept its benchmark rate at 3.5% to 3.75% all year. With inflation heating up, rate cuts are off the table.

3. Stocks are priced like 1999. Robert Shiller's cyclically adjusted price-to-earnings ratio sits above 40 - more than double its historical average and only matched by the dot-com peak.

4. Rally is too narrow. Goldman Sachs estimates AI-related spending drives roughly 40% of the S&P 500's earnings growth. A stumble in a handful of tech names could hit the entire market.

5. Seasonal headwinds. Summer is historically weak, and a midterm election year tends to be the weakest stretch of the four-year cycle.

Why not sell? Earnings are booming. S&P 500 profits grew more than 28% in the first quarter; 84% of companies beat estimates. Goldman just raised its forecast. Any pullback, the advisor says, will be temporary - a 5% to 10% dip that gives patient investors a buying opportunity.