A seasoned market strategist told CNBC that the Federal Reserve has no reason to cut interest rates by another 50 basis points, stating that the latest U.S. employment data suggests the Fed may have acted prematurely.

David Roche, founder and strategist of Quantum Strategy, described the Fed's decision last month to lower the key overnight lending rate by 0.5 percentage points as a knee-jerk move.

The non-farm employment data released last Friday showed that employment increased by 254,000 people in September, far exceeding economists' expectations of 150,000. At the same time, the unemployment rate fell to 4.1%, down by 0.1 percentage points.

Roche said that these figures made the Fed's "drastic rate cut move appear foolish, populist, and panicky."

"The mistake lies in over-reliance on data and a lack of strategic vision," he said in an email comment last Friday, pointing out that, therefore, there should not be "another substantial rate cut... unless something really bad happens," such as a Middle East conflict escalating to the point where Israel bombs Iran's nuclear test sites.

Roche said in an interview with CNBC on Monday that the Fed's move could be harmful because it gives a false impression of the U.S. economy.

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"Firstly, (it gives the impression that) the economy is more fragile than it actually is... the economy is doing very well, thank you very much, and does not need a substantial rate cut," he told CNBC.

"The second thing is to give you the impression that the Fed will continue to cut rates far below the actual level. The Fed rate will not be below 4% or 3.5%, and the reason is that the economy is so strong that businesses can make enough money without lowering interest rates."

Roche said that by "making a substantial rate cut at the start," the Fed gives the impression that there will be "more substantial rate cuts of 50 basis points," which could lead to "market instability when the market realizes this fact."

The Fed defended the substantial rate cut at the time, citing signs that inflation is slowing and the labor market is weakening.Following last week's data release, traders' expectations for a substantial interest rate cut in November have plummeted dramatically.

The Fedwatch tool from CME Group indicates that the likelihood of the Federal Reserve lowering the target range for the federal funds rate by 25 basis points to 4.5% to 4.75% in November currently stands at 87.4%.

The tool shows that the probability of the interest rate remaining at 4.75% - 5% is 12.6%, while the chance of a 50 basis point rate cut is 0%. However, just a week ago, the probability of a substantial rate cut was 34.7%.

The Federal Open Market Committee (FOMC) opted to lower the federal funds rate by 50 basis points last month, marking the first time it has done so since the 2008 global financial crisis—excluding emergency rate cuts during the COVID-19 pandemic. The FOMC also indicated through its "dot plot" that it would cut rates by another 50 basis points by the end of this year, with two meetings scheduled for November 6th-7th and December 17th-18th.

Bob Parker, Senior Advisor at the International Capital Markets Association, agrees with Roche's view that "there is simply no reason for the Fed to make a substantial rate cut."

"We're back to two fundamental points. First, the likelihood of the U.S. economy falling into a recession, at least in the fourth quarter of this year and possibly the first quarter of next year, is close to zero. Overall and core inflation rates will remain above the Fed's 2% target, thus there is no reason for a substantial rate cut."

"Yes, there could be a modest rate cut, possibly a 25 - 50 basis point cut before January next year, but the scenario of a 50 basis point rate cut at the next meeting simply does not exist," Parker stated.

Global stock markets rebounded last Friday following the release of U.S. employment data that eased concerns about an economic slowdown; however, analysts warned that the upcoming U.S. presidential election and unrest in the Middle East could lead to increased market volatility in the coming weeks.

Dave Pierce, Director of Strategic Initiatives at GPS Capital Markets, stated that despite the Dow Jones Industrial Average rising by 300 points last Friday and the market experiencing "sharp fluctuations," the recent downward revision of U.S. non-farm employment data should indicate a need for caution.

In an interview with CNBC on Monday, he said, "It feels like these numbers are not as accurate as they should be.""So, while I believe that employment data is absolutely important, absolutely important, and it will really affect the situation at the Fed's next meeting—where the possibility of a 50 basis point rate cut is almost 100% impossible—we see some improvements in the economy, but we also see some slowdowns," said Pearce. He added that the residual negative sentiment surrounding the US economy is mainly focused on inflation and its impact on the daily lives of Americans, with the US inflation rate at 2.5% in August.

"The US economy is performing well, no one is saying the US economy is not doing well, but there are still many people struggling, especially in the face of inflation and rising prices in recent years," he said. "I think it is such things that lead to the underlying sentiment in the market that things are not at the level they should be. Because even if people find jobs, they are still struggling to maintain their daily lives."