NEW YORK (TheStreet) -- Volatility in the bond market may be starting to finally concern equity investors. The S&P 500 dropped nearly 1% Thursday. European bonds are becoming increasingly more volatile, Tim Seymour, managing partner of Triogem Asset Management, said on CNBC's "Fast Money" TV show.
Seymour said that while higher interest rates aren't necessarily a bad thing for all stocks, it is certainly negative news for select sectors. He said a strong labor report on Friday could send stocks lower because investors anticipate the Federal Reserve will then increase interest rates sooner than expected.
Brian Kelly agreed, but also agrees with the International Monetary Fund, which believes the Federal Reserve should postpone an interest rate hike until 2016. Kelly, the founder of Brian Kelly Capital, explained IMF chief Christine LaGarde's comments were initially well-received by investors until they realized it likely means the IMF doesn't view the economy as strong enough to justify higher rates. Ultimately, that pushed stocks lower on Thursday.
Dan Nathan, co-founder and editor of riskreversal.com, is looking for a pullback of "significant manner" but acknowledged he's unsure if now is that time. While investors aren't showing a ton of fear, a 5% to 10% decline could be in the cards.
Some investors are starting to think about the possibilities of a decline, said Jon Najarian, co-founder of optionmonster.com and trademonster.com. He pointed out that the CBOE Volatility Index (VIX.X) climbed 7.7% and there have been noticeably large buyers of call buyers in the index.