Sentiment in global stock markets improved considerably over the past week, with most of your positions bouncing sharply. Although the MSCI Emerging markets index still is trading below where it was in early November, global markets seem to have emerged relatively well from their recent correction. In addition to what is generally a strong part of the year, the prospect of the extension of the Bush tax cuts for the next year means that the U.S. economy may grow and extra 0.5% to 1% in 2010, pushing markets higher.
You had big gains in Freeport-McMoRan Copper & Gold, Inc. (FCX) (up 9.19%); Market Vectors Indonesia ETF (IDX) (up 7.5%); Market Vectors Russia ETF (RSX) (up 7.3%); and Vale S.A. (VALE) (up 7.1%).
A number of your positions hit highs for the year including the iShares MSCI Taiwan Index (EWT), Freeport-McMoRan Copper & Gold, Inc. (FCX), Vale S.A. (VALE) and Market Vectors Russia ETF (RSX).
From a technical standpoint, our overall investment strategy remains the same. If a position has fallen below its 50-day moving average, I am moving it to (or keeping it at) a HOLD. If a position rises back through its 50-day moving average, then I have moved it back to a BUY.
This happened with a number of your positions this week, including Market Vectors Brazil Small-Cap ETF (BRF), iShares MSCI Malaysia Index (EWM), iShares MSCI South Korea Index (EWY), Claymore/BNY Mellon Frontier Markets (FRN), Market Vectors Russia ETF (RSX) and Vale S.A. (VALE). All of these positions are back to BUYs.
Overall, I remain bullish for the remainder of the year and I expect your Global Stock Investor portfolio to perform strongly in December.
Portfolio Update
Market Vectors Brazil Small-Cap ETF (BRF) rose 1.88% this past week. Having pushed back through its 50-day moving average, this bet on Brazil’s domestic economy is back to a BUY.
The WisdomTree Dreyfus Chinese Yuan Fund (CYB) rose slightly this week. Trade transactions settled in the Chinese yuan totaled 340 billion yuan ($51 billion) between June and November — seven times its previous level. CYB is a HOLD.
iShares MSCI Malaysia Index (EWM) rose 2.49% this past week. Malaysia is ramping up its campaign to attract foreign investments in the country under its Economic Transformation Programme (ETP). Trading up through its 50-day moving average, EWM is now a BUY.
iShares MSCI Taiwan Index (EWT) jumped 5.53% this past week, and hit new highs for the year. This technology-heavy index is now the best-performing market in Asia over the past few months. EWT remains a BUY.
iShares MSCI South Korea Index (EWY) jumped 6.26% this past week, as memories of North Korea’s shenanigans fade. EWY is back to a BUY.
Freeport-McMoRan Copper & Gold, Inc. (FCX) soared 9.19% this past week, as the prices of copper and gold continued to trade at or near record levels. One of the strongest stocks out there, FCX remains a BUY.
Claymore/BNY Mellon Frontier Markets (FRN) jumped 1.95% this past week, as frontier markets like Chile, Colombia and Poland bounced. Once again trading above its 50-day moving average, FRN is back to a BUY.
CurrencyShares Japanese Yen Trust (FXY) traded slightly higher this week. The Japanese yen is trading firmly, but is confined to narrow ranges against the dollar. It is a defensive HOLD.
Market Vectors Indonesia ETF (IDX) jumped 7.5% this past week, as the “next BRIC” got back on track. Slicing through its 50-day moving average, IDX is now back to a BUY.
Las Vegas Sands Corp. (LVS) took a big blow last week when the Macau government failed to approve its land concession for its final two parcels of land on the Cotai Strip. Las Vegas Sands already has sunk $162 million into the property, according to Sands China CEO Mike Leven. Until the implications of this are cleared up, I am temporarily moving LVS to a HOLD.
Market Vectors Russia ETF (RSX) jumped 7.3% this past week, and is trading at yearly highs on news that PepsiCo will acquire 66% of Russian juice and dairy major Wimm-Bill-Dann for $3.8 billion. RSX is back to a BUY.
Vale S.A. (VALE) jumped 7.1% this past week to hit a yearly high, as the company lists its shares on the Hong Kong Stock Exchange today. Rising through its 50-day moving average, Vale is back to a BUY.
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