Goldman Sachs Chief Strategist Jim O'Neill says unemployment problems in the U.S. pose a bigger threat to markets than the European debt crisis.

"The markets are right to be concerned with these (European) issues, O'Neill told CNBC. "But just as importantly ... in my opinion is what's going on with weaker job claims and the growing evidence that some of the momentum in the U.S. has been lost."

"I'm not sure that the European thing is that important to non-European markets going forward. Europe doesn't run the world.”

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In addition, O’Neil says that countries closer to the debt crisis such as Holland and Switzerland are "doing just fine," O'Neill and attributes the depth of the euro zone impact to a lack of confidence from corporate America, one of several factors he believes will contribute to "continued choppiness through the summer" for the stock market.

"The second half of the year, unless Europe completely implodes, I'm still in the camp that the markets recover, particularly the U.S. and some of the big (emerging markets) and we could still conceivably see new highs," says O’Neill. "So we shouldn't get solely focused on the European stuff."

CBS News reports that weekly jobless claims for the most recent reporting period declined by 2000 to a seasonally adjusted 377,000.

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