Gundlach says to buy international stocks on dollar’s ‘secular decline’

The shift in global markets has caught the attention of DoubleLine Capital CEO, Jeffrey Gundlach, who recently shared his insights on the current investment landscape. Gundlach believes that international stocks are set to outperform U.S. equities due to the weakening dollar, which he sees as the beginning of a long-term downtrend.

In a recent investor webcast, Gundlach advised against holding U.S. stocks and instead recommended investing in stocks from around the world. He emphasized that the weakening dollar could provide a significant boost to dollar-based investors who choose to allocate their capital to foreign markets.

The decline in the dollar can be attributed to President Trump’s trade policies, which have sparked concerns about the future of U.S. assets. The ICE U.S. Dollar Index has already dropped by about 8% this year, signaling a shift in global sentiment towards the greenback.

Gundlach specifically mentioned emerging market countries as attractive investment options, with a preference for long-term holdings in India. He also highlighted Southeast Asian countries, Mexico, and Latin America as potential areas for investment.

The investor also pointed out that geopolitical tensions could be deterring foreign investors from committing capital to the United States, creating an additional tailwind for international markets. Gundlach believes that a reversal in this trend could lead to significant selling in U.S. markets, further supporting his preference for international stocks.

Gundlach has been bearish on the U.S. markets and economy for some time, citing several recession indicators that are starting to “blink red.” He predicted that the Federal Reserve will maintain interest rates at the upcoming policy meeting, despite current low inflation rates.

Looking ahead, Gundlach expects inflation to reach around 3% by the end of 2025, but acknowledges the uncertainty surrounding future price pressures due to the lack of clarity in President Trump’s tariff policy.

Overall, Gundlach’s insights provide valuable guidance for investors looking to navigate the evolving global market landscape. By diversifying into international stocks and monitoring the impact of geopolitical tensions on investment flow, investors can position themselves for potential growth opportunities in the coming years.