Marc Faber : Indian Stocks are not Cheap; they are quite Expensive

Many expect Sensex to touch 24,000 this year. How much upside do you see for the Indian markets?

Marc Faber : In dollar terms, the Indian equity markets are still down 40 per cent from their highs adjusted for the weakness of the currency. I think markets may rally somewhat further.

I think investors must realise about India that index stocks are not that cheap; they are quite expensive from a valuation point of view. You have many sectors in the economy that are depressed in valuation, I think the index will not do that much going forward, but some of the stocks will do well.
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Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

The Indian Market is still down about 40% from the peak

In dollar terms, the Indian market is still down about 40% from the peak, because the currency has weakened.

In the 1970s, stock market indexes performed poorly and stock-picking came to the fore. Asia could be like that now. It is a huge region, and you have to invest by company. Some Indian companies will do well, and others poorly. Some people made 40% on their investments in China last year, but the benchmark index did poorly.



Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

Marc Faber : Indian Stocks not bottomed yet

We are probably at the beginning of a more significant asset class deflation. If you look back, we had huge increases in asset prices, whether it is real estate, equities, bonds, gold or commodities.

When you print money, prices do not go up evenly and they do not fall all at the same time. So, the money flowed between 1996 and March 2000 into high-tech NASDAQ stocks and also in India. Then

In case of India, the Indian ETF is now down 32% from the November 2010 high. It has performed miserably, relatively to the US. So the market will bottom out, but it is too early to buy anything at the present time.
this was deflated and post 2000, we had in the US the colossal credit bubble where the money flowed mostly into housing which was deflated after 2007. After that, we had a huge flow of funds into emerging markets and emerging market bonds. I think that will also be deflated as in some cases we have already gone down quite a bit.


Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.