Future Bear Market is a Great Opportunity for Mainly Value Stocks!

Dear Reader,

I still expect US stock markets, measured by the main indices DJIA, S&P500, Nasdaq Composite to go into a bear market defined by a fall of more than 20% from the recent peaks. It is true Nasdaq almost touched this level, but I expect DJIA, S&P500 to fall by 20% as well.

That would be a great buying opportunity. I expect large banks(Citi, JPMorgan, Bank of America, MorganStanley, Goldman Sachs and Wells Fargo) to outperform after the fall. Large IT companies like Google, Apple, Microsoft to outperform after the coming fall.

Facebook seems overvalued. Twitter and LinkedIn after the recent fall seem to be undervalued. If the 20% market drop I forecast does not materialise, Twitter and LinkedIn  could prove great investments.

I expect the Federal Reserve to hike the Federal Funds Rate in March 2016, contrary to market expectations. I expect the US 10 year treasury yield to reach 2.70% by the end of 2016.

The German 10 year Bund is grossly overpriced. I forecast the 10 year German bund yield to touch 1.00% in 2016.

The European Central Bank will disappoint markets again in March. If central banks could do everything, why haven't we thought about this sooner?! :-)

Oil is to recover to 50 USD in 2016. Russian stocks are undervalued. The issue seems to be structural, because other large emerging markets like Brazil and China trade at much higher multiples.
I expect this to partly reverse. Russia is still a powerful country and economy.

Gold is to fall to 1000 USD in 2016 again. The USD/YEN to touch 100 in 2016, EUR/USD to touch 1.00 in 2016.


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Conflicts of interest: I may possess some of the securities,currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!