Markets are rocky.
And in a morning note on Tuesday, Peter Tchir, a strategist at Brean Capital, writes that right now, nothing in markets looks particularly stable or particularly attractive.
“I find it impossible to look at these moves and want to take significant risk (long or short),” Tchir writes.
In his note, Tchir highlights some of the biggest moves we’ve seen in global markets over the last 48 hours, noting that in trade on Tuesday Chinese stocks rose 11% from their overnight lows after dropping 20% in just 2 weeks.
Other wild moves on Monday include a more than 12 point drop — or 25% — drop in Greek bonds while Puerto Rico bonds “outperformed” by dropping “just” 11% on Monday.
In short, a wild day. And the problem, as Tchir sees it, is that these moves are all more or less disconnected. “It isn’t ‘just’ Greece that we need to watch out for. There is danger on many sides, none having anything to do with anything else,” Tchir writes. “The ‘attack’ on risk is coming from unusual places.”
Tchir adds that while US futures and Treasuries are higher on Tuesday morning, he would view any “bounce” as a chance to sell or simply stay uninvolved.
“I remain in risk off mode,” Tchir writes, “which makes me wrong for the moment, but with this level of volatility, that can change dramatically and in a hurry.”