Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

Considering the week of Thanksgiving is traditionally one of the strongest of the year, it’s not been a great week. Asian markets tumbled overnight and shares fell across Europe as crude oil flirted with $100 per barrel. Hong Kong shares fell sharply and Japan’s benchmark index fell to its lowest level in 16 months. Since the start of November, the index has dropped 13.1%. In Europe, most markets also were lower.

Our top performer of the week was the Japanese Currency Trust (FXY) as the dollar fell to a two-year low against the yen. Despite the negative headlines, most of the holdings in our Global Stock Investor portfolio held up well. Investment is all about playing the odds. And odds are that the current market swoon is just a correction as our bullish global megatrends remain intact. The worse it feels now, the sharper the recovery. The bottom line? We need to keep our cool, stick to our stops, and ride out the current market storm.

Portfolio Update

Anglo American (AAUK) fell sharply this week on the back of the market’s “baby out with the bathwater” behavior. U.K. brokerage firm Cazenove upgraded Anglo American to an "outperform" rating based on the company’s exposure to platinum, ongoing operational streamlining and its merger and acquisition potential. The commodities supercycle remains intact and the stock remains a BUY.

ABB Ltd. (ABB) completed the sale of its downstream oil and gas business Lummus Global to Chicago Bridge & Iron Co for an enterprise value of $950 million. ABB also won a $45 million contract from Angola’s Empresa Nacional de Electricidade (ENE) to connect the electrical grids in the northern and central parts of Angola. ABB is a BUY.

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America Movil (AMX) ended the week flat. Keep looking for a bounce in this technically oversold telecom giant. America Movil is a BUY.

iShares MSCI Swedish Index ETF (EWD) remains worth watching. Sweden’s ruling coalition has cut income taxes, lowered real estate levies and announced that it will abolish the wealth tax at the start of next year. The reduction in taxes fueled consumer spending and economic growth. Those moves pushed unemployment to a 15-year low of 3.3%, while helping to create 85,000 jobs in the past year. The increase in employment and the cut in benefits led to a 12% annual drop in the number of people collecting sickness payments in September. Sadly, this progress has not translated into gains in the stock market. Sweden stays a HOLD.

iShares MSCI Brazil Index ETF (EWZ) has held up remarkably well for a market that is usually the first to sell off during Mr. Market’s mood swings. Brazil remains a BUY.

Japanese Currency Trust (FXY) was up again this week as the dollar hit lows against the yen. It remains a defensive BUY.

ICICI (IBN) held up above the $60 level this week, showing some solid relative strength. If you own ICICI bank, you’re in good company: George Soros invested in ICICI in the third quarter. “India’s Citibank” is a BUY.

Millicom International (MICC) received another feather in its cap, as Moody’s upgraded Millicom’s corporate family rating to Ba2 from Ba3 and its senior notes rating to B1 from B2. This reflects the company’s continued robust operational and financial performance. Millicom remains a BUY.

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ArcelorMittal’s (MT) credit rating was raised by Standard & Poor’s yesterday to BBB+ from BBB, on the back of improved finances and a stable outlook for the world’s largest steelmaker. Arcelor Mittal also signed an agreement to buy a 12.6% stake in General Moly, a U.S.-based mining company, for $70 million, as well as an agreement with Kalagadi Manganese, a South African manganese development company, to create a joint-venture to develop a manganese mine and a smelter complex. ArcelorMittal is a BUY.

Potash (POT) announced plans to expand a Canadian potash mine and mill for $1.8 billion to boost the company’s output of the fertilizer by nearly 15% within five years. The expansion will boost company-wide potash production capacity to 15.7 million tonnes annually by 2012, three years earlier than previously estimated. Potash is a BUY.

Tesco (TSCDY) dominates markets where ever it goes. Fact of the week: it is a bigger purchaser of Irish food and drink than several countries, including France, Germany and the United States. Tesco remains a BUY.

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