Our Global Stock Investor portfolio recovered strongly this week. Markets bounced back on positive U.S. housing data. After plunging 14% to a 10-year low in January, housing starts rebounded in February with a 9% rise — easing the worst fears about a housing market crash.
Global markets also rallied across the board. The Bank of Japan left interest rates unchanged at 0.5% to ease concerns about the unwinding of the carry trade.
Remember, the sharper the sell-off, the sharper the rebound. So our Global Stock Investor portfolio is well-positioned for the coming recovery in global markets. All of our current recommendations remain buys at these levels.
Our lowest-risk play, the Swedish ETF (EWD), was up 4.3% for the week and is now firmly in the black since our initial recommendation.
Mexico-based Latin American cell phone giant America Movil (AMX) shot up over 4.6%. Mexican stocks posted particularly sharp gains yesterday, as local investors returned from a long weekend and played catch-up to other markets. Mexico’s IPC index jumped 506 points, or 1.9%, to 27,407.46. That was the IPC’s highest close since its 5.8% plunge on Feb. 27, when the index recorded its biggest drop in nearly seven years.
Cognizant Technologies (CTSH) was up just a hair under 3%. This Teaneck, N.J.-based Indian outsourcing play continues to garner accolades. This week it was named one of Business Week‘s 50 Best Performing Companies, ranking 12th overall and second in the Information Technology sector. The rankings are meaningful, since Business Week selects the "best in class" from each of the 10 sectors that make up the S&P 500. Companies were chosen based on sales growth, average return on capital, total return, profitability and rank within industry sector.
This is Cognizant’s first year in the rankings, which are published in Business Week‘s issue of March 26, 2007. Cognizant was the only IT services outsourcing company given the honor. This recognition follows Cognizant’s #6 ranking among Business Week‘s Hot Growth Technology Companies in December.
ICICI bank (IBN) found its feet by moving up 1.7% for the week. The Wall Street Journal featured ICICI this week in a story about India’s mortgage market. Here’s a statistic to ponder: in a nation of over one billion people, only five million home loans have been made in the past 25 years. While highlighting ICICI as the most aggressive Indian bank in the retail market, the story also pointed out that its mortgage loans still make up only about 30% of ICICI’s loan book. That makes the potential growth of ICICI over the next five years staggering.
Our speculative Chinese small cap, Nasdaq-listed Home Inns & Hotels (HMIN), stabilized and was up 2.1%. Certainly, Home Inns’ strong results, announced two weeks ago, underpin our view that it has the potential to be a genuine "Home Run" stock.
I am working on finalizing the next edition of the Global Stock Investor and the newsletter should be mailed to you next week. I’m sure you’ll agree that the April issue’s featured stock is one of the most exciting, yet safest, global investment ideas you’ve heard in a long time.
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