State Street is issuing words of caution to dip-buyers after its gauge of market health flashed warnings of economic stress and drawdown risk to come.

Belying the Dow Jones Industrial Average’s sharpest surge since 1933, the systematic-risk indicator which the securities behemoth uses to guide allocation calls rose to an all-time high Tuesday.

The reason: Stocks across the world and industries are moving together like never before in a sign of acute macro anxiety over the spreading coronavirus. Yesterday’s sharp rebound spurred by stimulus-related headlines only serves to show a market prone to correlated one-way moves and unprecedented volatility.

 “Bull markets do not typically begin with 10 percent rallies in a single day, even if the policy response to this crisis has been more expansive and powerful than any previously offered,” Tim Graf, head of EMEA macro strategy at State Street Global Markets, wrote in a note. “A better sense that this gauge of market fragility has entered a sustained decline is needed before we have more confidence that the crisis is finally quelled.”

SSGM provides research and trading services at the finance giant which includes asset manager State Street Global Advisors.

Stocks have been rebounding amid optimism around extraordinary fiscal and monetary packages aimed at countering the hit from the pandemic. U.S. shares looked set to post their first back-to-back gains on Wednesday since the coronavirus crisis began.

With the recent spate of forced selling easing and buy-and-hold investors like pension funds potentially ready to step in, the likes of JPMorgan Chase & Co. are more constructive on risk assets.

Yet stronger evidence on the efficacy of both stimulative measures and public-health planning in concert with a peak in infection rates are still needed to entrench bullish conviction.

That may be a long time coming. Over a 500-day trailing window, State Street’s risk analysis dissects the daily returns of MSCI equity industries, known as principal components analysis, to divine correlations. The conclusion: the equity market remains acutely fragile.

“Global equities are clearly a better value proposition than they were a month ago, but we would exercise caution against value opportunities becoming value traps due to the many variables around the spread of Covid-19,” Graf wrote.

This article was provided by Bloomberg News.