The US will not be immune to the slowdown underway in China and will see a massive slowdown unfolding, said Morgan Stanley's Ruchir Sharma.
Sharma believes that US market has hit a peak and the market has been underestimating China slowdown concerns.
“The American stock market is at a 100-year high relative to the rest of the world and that sort of is as stretched as the American stock market is going to get. However, the immediate concerns have to do with China and I think that, it is possibly being underestimated by the market, which is that there is a great faith that the policymakers in Beijing are about to come out with another stimulus and they have been doing a series of easing measures and those stimulus measures are once again going to rescue the Chinese economy,” he said.
“Markets have now gone into pricing a lot of some sort of a trade agreement compared to expectations of virtually nothing happening in October, November last year. So I think a lot of that now is getting priced in but I think there is a more fundamental issue out here which is that regardless of what happens on this trade front, we are in an era of de-globalisation. The world is getting much more split into regional blocks and barriers are going up everywhere and I don’t see that changing with one US-China trade agreement,” said Sharma.