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I don't think the market's cheap, but it's hard to go short with economic backdrop, says Appaloosa's David Tepper

Relief from business regulations at home and rapid growth abroad are providing a supportive environment for the stock market, hedge fund titan David Tepper said Wednesday.

While he conceded that stocks are not "really cheap" at this point, he said the backdrop is solid enough to keep him in the market, particularly when global central banks are still accommodative.

"Listen, it's hard to go short when you still have the drugs being given," he said on CNBC's "Squawk Box." "The punch bowl's still full."

Tepper said he is long on European stocks but is betting against bonds.

"You bet your heinie," he said when asked if he was short fixed income.

Tepper stressed the importance of the regulation pullback, which is a cornerstone of President Donald Trump's platform. However, he cautioned against the president's campaign against immigration, calling it "dangerous." On the other hand, he said the threat of a trade war with China has abated.

"That big risk is off the table," he said. "Hopefully they'll get some kind of settlement with Mexico."

Tepper is known for his market-moving comments. Back in 2010, the "Tepper rally" began when he said stocks would be supported either by growth or by aggressive central bank policies.

He said Wednesday that the Fed is "way low where they should be" regarding rates. The market expects the Fed to raise rates a quarter point when it meets next week.

However, Tepper said even with rising rates that shouldn't pose a problem for businesses and the market

"There's nothing to get in the way until potentially inflation starts picking up and people start getting worried about that," he said.

This is a breaking news story. Please check back for updates.