Southeast Asia's largest bank CEO warns investors: 'Buckle up, we're in for a volatile ride'

With valuations successful the U.S. banal marketplace becoming progressively stretched, the main enforcement of Southeast Asia's largest slope is informing investors to expect turbulence ahead.

"We've seen a batch of volatility successful the markets. It could beryllium equities, it could beryllium rates, it could beryllium overseas exchange," DBS CEO Tan Su Shan told CNBC, adding that she expects that volatility to continue.

Tan, who took implicit the helm of DBS from longtime CEO Piyush Gupta successful March, said that investors were peculiarly disquieted astir the lofty valuations of artificial quality stocks, particularly the alleged "Magnificent Seven."

The Magnificent Seven — Amazon, Alphabet, Meta, Apple, Microsoft, Nvidia and Tesla — are immoderate of the large U.S. tech and maturation stocks that person driven overmuch of Wall Street's gains successful caller years.

"You've got trillions of dollars tied up successful 7 stocks, for example. So it's inevitable, with that benignant of concentration, that determination volition beryllium a interest about. 'You know, erstwhile volition this bubble burst?'"

Earlier this week, astatine the Global Financial Leaders' Investment Summit successful Hong Kong,  it was apt determination would beryllium a 10%-20% drawdown implicit the adjacent 12 to 24 months.

Morgan Stanley CEO Ted Pick said at the aforesaid acme that investors should invited periodic pullbacks, calling them steadfast developments alternatively than signs of crisis.

Tan agreed. "Frankly, a correction volition beryllium healthy," she said.

Recent examples see Advanced Micro Devices and Palantir, some of which posted stronger-than-expected quarterly results connected Tuesday, yet their shares — and the wider Nasdaq — fell.

Her remarks travel akin warnings by the International Monetary Fund and cardinal slope chiefs Jerome Powell and Andrew Bailey, who person each cautioned astir inflated banal prices.

Tan advised investors to diversify alternatively than ore holdings successful 1 market. "Whether it's successful your portfolio, successful your proviso chain, oregon successful your request distribution, conscionable diversify."

Tan, who has implicit 35 years of acquisition successful banking and wealthiness management, noted that Asia could pull much concern from the U.S.—and that it's not a atrocious thing.

Singling retired Singapore and the country's cardinal bank's efforts to boost involvement successful the section markets, Tan described the city-state arsenic a "diversifier market."

"We've got regularisation of law. We're a transparent, unfastened fiscal strategy and unchangeable politically. We're a bully spot to invest.... So I don't deliberation we're a atrocious spot to deliberation astir diversifying your investments."