Tags: ONeill | US | emerging | markets

Jim O'Neill: Bearish on US Stocks, Bullish on Emerging Markets

By    |   Wednesday, 07 May 2014 01:58 PM

Jim O'Neill, former chairman of Goldman Sachs Asset Management, says he wouldn't buy U.S. stocks at this point. But the inventor of the term BRIC, which stands for Brazil, Russia, India and China, is more optimistic about emerging markets.

As for the U.S., if the S&P 500 falls for the first five days of January, research shows there's a 50 percent chance it will decline for the year as a whole, O'Neill tells MarketWatch. And that's what happened this year.

"It adds to my view that I don't know what's going to happen with the U.S. market, but it wouldn't surprise me if it goes down," he states.

Editor's Note:
Secret Wall Street Calendar Uses Strange ‘Crash Alert System,’ Gets 18.79% Annual Returns

"I'm slightly in the negative camp, because I also believe in this 'sell in May and go away' thing. If you look at the past 50 years, it kind of works. There's no logical reason, but it works."

Stocks have historically underperformed in May through October.

As for emerging markets, valuations there "are so attractive relative to the structural story and relative to the developed world," O'Neill notes, adding that although Russian stocks seem cheap, he wouldn't buy into it now.

"Despite the valuation, I'd want to see some evidence that something's changing [in the country]."

The MSCI Emerging Markets (Stock) Index has gained 3.9 percent during the past three months.

Star investor Jim Rogers isn't too enthusiastic about U.S. stocks either. While the entire market isn't in a bubble, some sectors might be, and the market as a whole is overpriced, he tells HardAssetsInvestor.com.

Both the S&P 500 and Dow Jones Industrial Average stand within 2 percent of their record highs.

"There are other markets around the world that are certainly much cheaper on a historic basis," Rogers notes.

Editor's Note: Secret Wall Street Calendar Uses Strange ‘Crash Alert System,’ Gets 18.79% Annual Returns

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Jim O'Neill, former chairman of Goldman Sachs Asset Management, says he wouldn't buy U.S. stocks at this point. But the inventor of the term BRIC, which stands for Brazil, Russia, India and China, is more optimistic about emerging markets.
ONeill, US, emerging, markets
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2014-58-07
Wednesday, 07 May 2014 01:58 PM
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