Why volatility will push stocks to overreact

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Mohamed El-Erian expects US stocks to overreact to volatility, potentially leading to a recovery from last week's tech sell-off, but also warning of potential future downturns.

Market Impact

Market impact analysis based on neutral sentiment with 75% confidence.

Sentiment
Neutral
AI Confidence
75%
Time Horizon
Short Term

Article Context

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As US stocks (^DJI, ^IXIC, ^GSPC) hope to recover from last week's tech sell-off, Allianz chief economic adviser Mohamed El-Erian tells Yahoo Finance that while volatility (^VIX, ^VVIX) already remains a top theme for markets in 2026, he outlines how investors should expect equities to overreact to the upside and the downside. El-Erian is also the Rene M. Kern Practice Professor at the University of Pennsylvania's Wharton School. Watch Mohamed El-Erian's full interview by clicking here. Also be sure to read up on Mohamed El-Erian's op-ed for Yahoo Finance addressing investor rotation in the tech sector and AI. To watch more expert insights and analysis on the latest market action, check out more Morning Brief.

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Original article published by Yahoo Finance on February 10, 2026.
Analysis and insights provided by AnalystMarkets AI.