'We still believe the market is ripe for a pullback': Analyst

With the markets at all time highs, "corrections may be coming," followed by more gains, says Tony Dwyer, analyst at Canaccord Genuity.

"We still believe the market is ripe for a pullback, but the focus should remain on our core fundamental thesis and the global reflation theme," Dwyer wrote in a note to investors.

Dwyer highlights the Federal Reserve's focus on obtaining sustainably higher inflation as well as money availability at historic levels.

The "economy is just in the beginning of a long-duration recovery, consensus EPS forecasts are still too conservative, and like 2010 any valuation contraction should be a result of a sharp EPS ramp rather than something more onerous," he noted.

Early during Tuesday's trading session the Dow (^DJI), the S&P 500 (^GSPC) and Nasdaq (^IXIC) all touchedrecord highsagain, an incredible comeback from almost a year ago when the pandemic was shutting down economies.

"The macro backdrop and market action coming off the March 2020 low continues to track the gains coming out of the Great Financial Crisis, which means corrections may be coming followed by even more gains," he added.

"Despite the prospect of a potential pullback, our investment themes remain in place given historic excess liquidity fueling a synchronized global recovery," said the note.