Invesco's Kristina Hooper warns the coronavirus is not the biggest threat to the market.
She sees flaring U.S.-China trade tensions potentially doing the most harm to stocks.
"The pandemic has largely been isolated and neutralized because of all the monetary policy support that the Fed has provided," she told CNBC's "Trading Nation" on Friday. "That really has decoupled the economy from the stock market."
Unlike the pandemic, Hooper contends a tariff war resurgence would be a direct hit to the market.
"As we saw in late 2018 and 2019, the tariff war was very, very problematic. It created a big headwind for stocks [and] a bigger headwind than for the overall economy, " she said. "That could be happening again this time around."
Wall Street has been getting rattled by intensifying rhetoric between the U.S. and China over who's to blame for the virus' deadly spread.
Beijing announced a plan for new security measures against Hong Kong late last week, which sent the Hang Seng to its worst session in about five years. President Donald Trump, who considers the move a human rights violation, warned Washington would react "very strongly" in response.
Last Wednesday, the Senate approved passed legislation that could force Chinese companies to delist from U.S. exchanges.
Even though Hooper is on alert, her base case is the war of words between the two countries is rhetoric, and it ultimately won't derail progress on the trade front.
And, she still lists China's stock market as her top global play.
"They're on the other side of the pandemic now. They're actually starting to see economic activity improve," added Hooper. "Plus, valuations look very, very attractive."
However, her bullishness on China doesn't mean she's avoiding U.S. stocks.
"I think of them as complementing each other. China has a very different risk reward profile than the U.S. does. The U.S. has a lot of defensive names that are being supported by monetary policy," noted Hooper. "For Chinese stocks, there's that growth opportunity."
To cope with the threat of a U.S.-China trade war resurgence, Hooper advises long-term investors to stay well-diversified.
"The biggest lesson we learned from the global financial crisis was to not abandon stocks because that's how we lock in losses," Hooper said. "Maintain disciplined, long-term asset allocations."