There may be trouble ahead for the U.S. stock market, two experts warned on Monday.
Scott Wren, senior global equity strategist at Wells Fargo Investment Institute, said there is a little enthusiasm and a bit of chasing going on right now in the market.
"Valuations are stretched. There's plenty of headwinds in the second half so I don't think the market is going to trade much higher than where we are right now before rolling over," he said in an interview with " Power Lunch ."
The problem is that investors are betting on tax reform from Washington, D.C., and "at best" there may be something in 2018, he explained.
"Nothing might happen. If nothing happens and we don't get any fiscal push here, you've got to think about a recession in 2019," Wren said.
Mark Eibel, client investment strategies director at Russell Investments, agrees. Until there is tax reform, there will continue to be low volatility and risk to the downside, he said.
"You're banking on Congress at this point to take you higher. I don't know if I want to be on that side of the trade," he told "Power Lunch."
Instead, he likes "almost anywhere other than the U.S." — especially Europe and emerging markets.
"If people want to replay the U.S. playbook, so to speak, of zero interest rates, quantitative easing, little bit cheaper stock prices and an economy that's actually improving, we think outside the U.S. is the place to be," said Eibel.
Both the Dow Jones Industrial Average and S&P 500 closed at new record highs on Monday .