Q: The US market has been fairly strong. We have seen the S&P move from strength to strength over the last couple of months. Where will those markets be headed because that would have ramifications for other equity markets?
Marc Faber : We have gone up to the peak on May 22 at 1687. During the preceding months, we went up by 7 percent, so 7 percent times 12 will give an annual gain of 100 percent. I don’t believe the S&P will go up 100 percent in the next 12 months at all. I rather think that the market is very high and if we make a new high in the next two-three weeks, it will not be accompanied by the majority of shares. However, the market could make a new high just on the back of strengths in IBM, Microsoft, Intel with the rest not moving.
It’s like 2012, until September the NASDAQ was driven by Apple and not by other stocks. So you can have a distortion in the index just because of few stocks moving up but the fact is that a lot of shares are already down 10-15 percent from their highs. The markets for emerging economies by and large peaked out in January. We had strength in Japan until recently, but within a few days it dropped 15 percent from the peak. - in moneycontrol
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.