NEW YORK (TheStreet) -- The S&P 500 finished January down nearly 4%, the worst January performance since 2010.
On CNBC's "Fast Money" TV show, Brian Kelly, founder of Brian Kelly Capital, said volatility is likely to stay in the market, which will be unable to rally until the emerging market issues are solved. He reasoned that equities would go lower.
Steve Grasso, director of institutional sales at Stuart Frankel & Company, said the S&P 500 seems likely to break the 100-day moving average to the downside, and eventually work its way down to the 200-day moving average near 1,700.
Josh Brown, CEO and co-founder of Ritholtz Wealth Management, said the market is turning into a "risk-off environment" where investors do not want to be in equities at the moment. He noted that the $12 billion in fund outflows was the largest weekly outflow of U.S. equities since 2012.
Tim Seymour, managing partner of Triogem Asset Management, said emerging market scares are nothing new. He reminded investors that U.S. economic data, like GDP and consumer confidence, remain strong.
Carter Braxton Worth, chief market technician and managing director at Oppenhiemer & Company, was a guest on the show. He said the S&P 500, on average, finishes the year lower only 33% of the time. However, when January ends the month lower, the likelihood the S&P 500 ends lower for the year jumps to 58%.
In the February through December time period, the S&P 500 is up, on average, just 1.65% when the month of January ends lower. This compares to the average increase of 8.5% when January is positive. He reasoned that the S&P 500 looks likely to decline into the 1,600s.
Satya Nadella, executive vice president of cloud and enterprise at Microsoft (MSFT - Get Report), is rumored to be the company's next CEO. The news sent shares of MSFT higher by 2%. Seymour said he wouldn't rush to buy the stock on this news and would "wait and see."
Google (GOOG - Get Report) made all-time highs after reporting earnings. Grasso said he was waiting for a pullback below $1,100. If possible, he wants to buy it at $1,060 but admitted that that might be too greedy.
Amazon (AMZN - Get Report) had its worst day in over two years after reporting earnings. Brown said most retail stocks ran too high in 2013, causing analysts to overestimate their projections. This, in turn, is causing many companies to miss estimates, and therefore is hurting the share prices.
Seymour added consumer spending has been strong, but margins continue to shrink for most retailers. Kelly suggested higher heating costs could weigh on consumer spending for the next month or two.
Chipotle Mexican Group (CMG - Get Report) was up 12% and was the first stock on the show's "Pops & Drops" segment. Seymour said he would be a seller after the stock failed to break meaningfully above $550.
For their final trades, Kelly is a buyer of ProShares UltraShort Euro ETF (EUO - Get Report) and Grasso is buying Southern Company (SO - Get Report). Seymour said to buy Potash (POT) and Brown is a buyer of VCA Antech (WOOF).
-- Written by Bret Kenwell in Petoskey, Mich.