Global economy is 'headed to a rapid recovery': Mark Mobius
As the U.S. economy reels from the COVID-19 pandemic, famed investor Mark Mobius said he expects it to sharply rebound by the end of 2020.
“I think we’re going to have a V-shaped recovery,” Mobius, chief executive officer of Mobius Capital Partners, said in an interview Thursday with BNN Bloomberg’s Amanda Lang.
“I think by the end of this year, you’re going to see a big rebound. And of course the stock market is telling us that. The market is telling us hey, we’re going to have a big recovery.”
Mobius' comments come on the heels of the largest decline of U.S. gross domestic output since at least the 1940s, as reported by Bloomberg News. In the second quarter, the nation’s economy shrank 9.5 per cent compared to the previous month and by 32.9 per cent year-over-year.
Mobius said that if the economy recovers in the way he predicts, he will be investing in value stocks and keeping a close eye on underperforming companies.
“We’re always looking at value at the end of the day. The big boys tend to come up first … if you see any laggards in the large caps, those that have not benefitted from the big upturn and their numbers look good, then definitely we have to pay attention to them,” he said.
But he added that his firm is eyeing smaller players as well.
“I would say focus on the smaller, the mid- and small-cap, I think that’s better,” he said.
Mobius, a long-time gold bull, also reiterated his case for investing in the precious metal, which has rallied to record levels as investors flee to safe havens during the pandemic.
“I’ve always felt that people should have at least 10 per cent of their portfolio in gold, in physical gold,” he said, with the caveat that there are “fluctuations in these markets” and that investors ought to tread carefully.
“I’ve been talking about gold and for once I’ve been right in making a prediction,” he said.