DENVER—Investors are uneasy about the stock market right now—and rightly so, according to the chief market strategist of Wunderlich Securities. “There’s a uniform feeling that we don’t trust this market. We have gone too far, too fast,” Art Hogan told attendees Aug. 16 at EnerCom Consulting’s 21st Oil and Gas Conference.

Hogan opened with a discussion of “the top 10 reasons why markets must go down.” Among them, he mentioned historically high stock price valuations; that “Wall Street has gone up more than Main Street;” geopolitical tensions in the Middle East; and a “choppy” U.S. housing market.

Stock prices appear too high, Hogan said, noting that shares of companies in the consumer staples and utilities businesses are trading at 20x to22x trailing earnings, with 14x being a historical average for those sectors. He analyzed the performances of the Russell 2000, Standard & Poor’s 500 index, and the NASDAQ composite for the past year—all three of which have climbed sharply since August 2015.

Noting there are stock price laggards, the Wunderlich analyst said it might be time for investors “to think about getting back into energy, industrials and healthcare.”

Hogan noted there have been encouraging signs for investors in recent months that tend to support the strong stock market. Overall economic data are improving, bank lending has picked up, the world’s central banks are more accommodative and Europe seems to be stabilizing economically, even with the U.K.’s Brexit vote, he said.

The strategist spent considerable time in his presentation analyzing how the stock market and the economy have impacted crude oil, natural gas and petroleum product trends. Overall economic trends are having multiple—and often conflicting—impacts on crude oil prices, Hogan noted.

Positive signs include an increase in global oil demand due to lower prices, a weaker U.S. dollar and tension between Saudi Arabia and Iran. Helping to dampen crude prices are OPEC’s commitment to maintain market share, Europe’s sluggish growth and China’s slowing growth.

But pointing to any one or two dominant indicators is difficult because the market is “way too complicated now. There’s less oil sloshing around the globe.”

U.S. production is down, in particular, while world economic growth continues, although slowly. The current situation is new, however, “because we have never been the swing producer before.”

He predicted supplies will continue to tighten as long as world geopolitical tensions remain high. A balance between supply and demand could be nearer than many industry observers think, he said, noting, “it only took one wildfire in Canada for crude to go from $40 to $50.”

So what ends a bull market? Hogan mentioned four causes.

First is a recession, which could be a possibility, although the nation’s lethargic growth rate is more likely to continue. Next, a too-fast tightening of interest rates by the Federal Reserve, “but with one hike in nine years that isn’t a problem,” he noted. The third cause would be an inverted yield curve, when short-term bonds pay better than long-term investment.

Last, he mentioned “irrational exuberance,” the term former Federal Reserve Chairman Alan Greenspan made famous in 1996 in reference to market speculation. “It’s when everybody quits their job and takes up day trading,” Hogan explained. The market isn’t quite there yet, he added.

Paul Hart can be reached at pdhart@hartenergy.com.