Looking for green shoots? Start looking outside the U.S.:
There's a good case to be made for China's continued growth given its deep reserves and trade surplus. The rest of the developing world is another story. I suspect a lot of the enthusiasm has to do with the recent resurgence of oil:
I thought about going long emerging markets a few months ago, so maybe I've missed the boat. I still might turn bullish on something this year besides China, but I'm willing to bet that people like Dr. Mark mobius are wrong that the 37% rise in emerging markets this year has a lot farther to go. I just can't help being cheap.
Nota bene: Anthony J. Alfidi is long FXI (with covered calls) and short uncovered calls on VWO.
After a crushing fall in the last year and a half, stock markets in developing countries are riding a wave of optimism that the recovery of the global economy is at hand and being led by the developing world, especially China. Though emerging markets remain far below the lofty highs they attained more than a year ago, investors are again viewing their chances of growth as better than those of the United States or Europe.
There's a good case to be made for China's continued growth given its deep reserves and trade surplus. The rest of the developing world is another story. I suspect a lot of the enthusiasm has to do with the recent resurgence of oil:
Crude oil rose to a seven-month high and gasoline surged after Goldman Sachs Group Inc. said prices may reach $85 by the end of the year as demand recovers and supplies shrink.
I thought about going long emerging markets a few months ago, so maybe I've missed the boat. I still might turn bullish on something this year besides China, but I'm willing to bet that people like Dr. Mark mobius are wrong that the 37% rise in emerging markets this year has a lot farther to go. I just can't help being cheap.
Nota bene: Anthony J. Alfidi is long FXI (with covered calls) and short uncovered calls on VWO.
