A Wall Street analyst warns tech investors reeling from the coronavirus market slide that we haven't hit the bottom just yet

• A veteran Wall Street tech analyst pointed to more uncertainty due to the coronavirus, and said investors eyeing a market bottom should be cautious.
• "We would not be tempted to catch the knife just yet as there is unlikely to be anywhere to hide in a recession scenario," Bernstein Research analyst Stacy Rasgon told clients in a note.
• Rasgon highlighted the worries in the chip sector as the Philadelphia Semiconductor Index outpaced the Dow and the Nasdaq in falling.
• But he also offered an upbeat longer-term view: "We presume the world, and the industry, will get through this. To that end, we would remain cautious in the near term."
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As the coronavirus crisis sent stocks tumbling yet again on Monday, a veteran Wall Street analyst had this message to investors eyeing a market bottom: "Don't catch the knife just yet" - in other words, things could dip even further.

Stocks fell sharply amid rising fears of the global impact of the virus, with the Dow Jones Industrial Average and the tech-heavy Nasdaq Composite Index each shedding roughly 5%.

Bernstein Research analyst Stacy Rasgon, who follows the semiconductor industry, said chip stocks point to a prolonged slump amid growing uncertainty.

"We see further risk to numbers and sentiment, with both news flow and revisions likely to get worse before they get better in the near to medium term," he told clients in a note. "Given the correlation of semis to GDP we would not be tempted to catch the knife just yet as there is unlikely to be anywhere to hide in a recession scenario."

Chip companies are often seen as indicators of the state of the economy since semiconductor companies must build their products ahead of any upswing in demand for end-customer goods. In fact, the Philadelphia Semiconductor Index, which tracks chip stocks - including Intel, Qualcomm, and Nvidia - has actually dropped more than 6%.

Rason noted that a recession could prove temporary, and offered a more upbeat view longer-term.

"Over a longer-term horizon we have a hard time coming up with nonapocalyptic reasons why demand, say, two years from now should be structurally lower than today," he added. "We presume the world, and the industry, will get through this. To that end, we would remain cautious in the near term."

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