For U.S. investors, the hometown trade is still intact.
That's at least according to Mark Tepper, president and CEO of Strategic Wealth Partners, and Matt Maley, chief market strategist at Miller Tabak, who told investors on Tuesday to stick to U.S. stocks amid a global sell-off and a 950-point drop in the Dow Jones Industrial Average.
Even with the threat of a global pandemic and U.S. health officials warning the outbreak is likely to get worse on the domestic front, U.S. equities are still the best bet globally, Maley and Tepper told CNBC's "Trading Nation" on Tuesday.
For Tepper, day two of the stateside sell-off seemed like a good time for investors to be refreshing their strategies.
"One of the things you should be doing right now is developing your shopping list and trying to identify which companies you'd like to own that maybe were too expensive a week or two ago," Tepper said.
The Dow and S&P 500 have each fallen about 7% in the last week. Other parts of the world have also seen sharp drops, with the Italian FTSE down over 8%, the German DAX down nearly 7% and the South Korean Kospi down almost 5% as of Tuesday. The Kospi closed down 1.28% Wednesday; other major Asian stock indexes closed fractionally lower.
"Identify the price at which [your stock picks would] be reasonable for you to purchase them, and when they fall into your lap, you pull the trigger," Tepper advised, adding that he wouldn't be surprised to see as much as a 10% drop in the major U.S. averages.
"It's very likely that we continue to fall a little bit further, but we're getting pretty close, so, I think it might be a good idea to really identify the companies you like and figure out where it makes sense to pull the trigger," he said.
The stocks of Salesforce and CVS stood out as particularly good picks, Tepper said in a note Tuesday to CNBC, flagging a "good entry point" in shares of CVS and calling Salesforce "cheap for the growth you're getting." Salesforce fell over 2% in Tuesday's session while CVS lost over 5%. Saleforce was down 2% in Wednesday's premarket on news that Keith Block is stepping down as co-CEO. CVS was down less than 1% in Wednesday's premarket.
Tepper also noted counterintuitive action in the Shenzhen Composite index, which is made up of smaller Chinese companies and is up nearly 13% year to date despite surveys showing small business owners struggling to stem the revenue damage from the coronavirus.
"I still think the U.S. is the cleanest dirty shirt," he said. "So, I'd be sticking with U.S. stocks."
Miller Tabak's Maley agreed that the stock market would soon "present some great opportunities, but not yet."
He noted the disparity that had come into play in global markets in recent weeks: While U.S. stocks climbed and reached overbought conditions, other markets were already beginning to price in the impact of the coronavirus's spread.
"We saw, of course, yields going to all-time lows on the 10- and 30-year bond," Maley said. "We see gold, although it's giving back a little bit today, rallying to new highs. So, the flight-to-safety trades were taking place, but they weren't going out of the risky assets. And so, I think there's more catch-up … to be done in the stock market."
"We're very overbought," he said, referring to the tech-focused Nasdaq 100. "The weekly [relative strength index] chart had gotten to levels that were usually followed by corrections anyway. So, this coronavirus has taken it down, but it's certainly not oversold yet. In fact, it hasn't even hit neutral territory. But it's not just here in the U.S. You look at the DAX, its RSI chart. Again, it topped out a little bit earlier — late January, early February — but it's only getting into neutral area, and the same thing with Japan's Nikkei Index."
In short, he added, "I do think that we have to see more of a flush-out move before we get these great opportunities, and down 10% is probably going to be the area."
That doesn't mean there aren't any opportunities, he said.
"For the most part, [China's] stock market has bounced back strongly in the last two weeks where the U.S. market is giving up the gains, and I think we're a much safer bet," he said. "You look at a very defensive name like Clorox, which, as the market has gotten clobbered the last two days, Clorox has broken out to new all-time highs. So, you might be a little defensive, but the U.S. is the place to be."
Disclosure: Tepper and Strategic Wealth Partners own shares of Salesforce and CVS.