"I'm fire right now," Strange points out. "How the hell can you shatter fire?"

He's being needlessly pedantic: he knows that Rita means she'll punch him when he turns back to his human form, but why not be a shit for the sake of being a shit. He continues to float near Rita's head. Though for all the shit Strange is giving her, he's keeping a safe enough distance that he doesn't make skin contact and doesn't burn her.