It's been a rollercoaster ride on Wall Street this week. The major stock market indexes (^DJI,^GSPC, ^IXIC) closed in positive territory on Thursday after being hit by a three-day sell-off at the beginning of the week. The Dow Jones Industrial Average jumped over 680 points while the S&P 500 had its best trading day since January 2023.

Raymond James CIO Larry Adam joins Market Domination Overtime to discuss the market action and how investors can navigate the pullback.

"What happened over last Friday and then Monday, I think everybody got a little bit premature thinking that this economy was going to roll over into a recession, that the Fed was going to have these emergency cuts, and the reality is that the economy is slowing, but it's not collapsing," Adam says of the sell-off.

He believes that while the economy will continue to slow, there will not be a recession when the Federal Reserves begins cutting rates. "I think we've learned over time that the market loves these narratives and you get to see these more extreme moves," he adds, thus fundamentals and earnings are more reliable metrics moving forward.

As the tech sector (XLK) took a beating this week, Adam believes that Nvidia's (NVDA) earnings will provide key insight into the sustainability of the AI race. "Our base case is that the AI theme is still very early stages and that it will continue to drive the tech sector for the foreseeable future," he explains. He notes that in Wednesday's trading session, mega-cap tech stocks went into oversold conditions, so investors could use dips as good buying opportunities.

For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.

This post was written by Melanie Riehl