Go Overweight US Stocks: Asia Strategist
Stocks climbed on Wednesday, following a succession of whipsaw trading days. Does this signal an end to the correction? Pierre Gave, head of Asia research at GaveKal Holdings, shared his insights.
“The 2008 collapse is still fresh in many investors’ memories, so the appetite for risk is at record lows," Gave told CNBC.
"And any sort of excuse to sell will trigger big coverings.”
The CBOE Volatility Index (VIX) , widely considered the best gauge of fear in the market, traded near 30 after jumping above 40 in the previous session. Gave said spikes in the VIX above 35 have typically been good buying opportunities.
“We’re now in a strong-U.S. dollar world...I would look to overweight U.S. equities and even U.S. growth stocks in general.”
In addition, Gave said he doesn’t expect a double-dip scenario.
“I look at the market fundamentals and they are far better than where they were in 2001 or in 2008, because we come from very oversold levels now," he explained.
"We’ve just had the mother of all recessions, so unless you’re a believer in some kind of cataclysmic double-dip scenario, I can’t see the market collapse much more from here.”
Scorecard — What He Said:
- Gave's Previous Appearance on CNBC (May 12, 2010)
- Fears Overdone, Double-Dip Unlikely: Strategist
- Stocks Could Now Rise 10%: Charts
CNBC Data Pages:
CNBC's Companies in the News:
- Toll Brothers Posts Smaller Loss; Shares Rise
Bank of America
No immediate information was available for Gave or his firm.