Global markets are off to a rough start this week.
Stock all around the world have seen a selloff of late, led in part by a drastic drop in China's Shanghai composite index, down 15 percent in two days. Japan's Nikkei index has fallen more than 8 percent this week. Markets in India, Korea, Australia, Brazil and others are also down for the week, although some bounced briefly Tuesday morning.
Major U.S. stock indexes on Tuesday broke a five-day losing streak, rallying more than 2 percent after the opening bell. But weakness has been spreading to the U.S. as well. The Dow Jones industrial average and are still negative for the year, down 9 percent and 6 percent, respectively.
But with domestic and international markets dropping drastically in the past few days, one trader says U.S. stocks are still an investor's best bet.
"Ultimately, the U.S. fundamentals are still looking very strong," Erin Gibbs, equity chief investment officer at S&P Capital IQ said Monday. "When you're in this risk flight environment, you really want to go to high quality, and right now the U.S. economy looks to be the highest quality."
As an indicator of domestic economic strength, Gibbs pointed to strong numbers from U.S. auto sales as well as existing home sales, which rose to an .
The iShares MSCI emerging markets ETF (EEM) is down more than 16 percent year to date, sparked by slowing growth in China and declining commodities demand.
Gibbs said although U.S. stocks could see further pullback in the coming months, she expects the blows to emerging markets to be much worse.
"We have really seen a change in risk appetite, and the current downturn that we're seeing right now is really about a contagion from investors changing from this fear-to-greed risk pendulum," she said on CNBC's "Trading Nation."
However, technical analyst Chris Verrone of Strategas sees better opportunities abroad, specifically in Europe and Japan.
"I'm not convinced that what we've seen in the U.S. is quite washed out yet," he said Monday.
Verrone said the number of stocks in the Nikkei that are still in an uptrend outnumber those in the S&P 500. Additionally, he believes that action on monetary policy from the European Central Bank and the Bank of Japan will help spur stock growth.
"I think both those markets may look more interesting here in terms of playing for a bounce," Verrone said.
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