When the financial crisis first hit, every market around the
globe felt the impact. Look at a five-year chart of any major
global index and you'll see huge losses from mid-2008 to early
2009. However, not every part of the world has recovered in the
same way. In fact, the United States has been one of the slowest
countries to rebound from the recession, while emerging countries
have shown the greatest resiliency
In the wake of the recession, a new economic pecking order will
emerge and certain countries will become oases for investors. At
the top of this list are places like Latin America, Asia, India and
even Europe! Let's take a look at three key areas now and my
favorite stocks in these regions:
Europe Stock - ARM Holdings (
ARMH
)
The euro zone has seen its share of volatility in recent months.
But while I like a few Europe stocks at the bottom, my favorite
European investment right now is actually one that's based in the
U.K. and therefore doesn't have to mess around with the euro
mess.
In Europe, I like
ARM Holdings PLC
(NASDAQ:
ARMH
), based in Britain. ARM Holdings PLC develops and licenses
microprocessors that allow several tasks to be processed
simultaneously. More than 200 chip makers, including Intel, Samsung
Electronics, STMicroelectronics, Texas Instruments and Toshiba
Semiconductor, license ARM's intellectual property designs to make
their own processors that are used in products such as digital TVs,
handheld computers, mobile phones and set-top boxes. More than 80%
of ARM's sales come from outside of Europe. This is a British
company, but it truly has a global presence.
Asia Stock - Jingwei (
JNGW
)
China is the driving force in Asia and, as of last week, has
officially become the second-largest economy in the world, ousting
Japan. This latest jump comes after China already leapfrogged
Britain and France in 2005 and Germany in 2007. Chinese
manufacturing figures were a bit deceptive this month but when you
get into the details you quickly realize that the news wasn't
negative. The manufacturing figure for July was 51.2, below 52.1 in
June, but any number above 50 is indicative of growth. The figure
shows that China continues to be the major worldwide economic
engine - and an emerging superpower when it comes to
technology.
Jingwei International Inc.
(NASDAQ:
JNGW
) is a software company in China that develops a number of
different products, including business support systems,
provisioning solutions and decision support and customer
relationship management systems. The company also operates a data
mining service in the form of a large database containing personal
information on more than 400 million Chinese consumers that it
offers to companies. Tech companies are hot right now and JNGW is
among the hottest, posting nearly 30% gains in the last 9 weeks.
This is a thinly-traded stock, though, so if you can't stomach
swings or can't buy and sell with tight limit orders, this play may
not be for you.
India
is another up-and-coming market that shows particular strength in
high-tech industries. The Indian economy is modernizing rapidly and
the country is developing a well-educated workforce and a
permissive corporate environment. This explains why a number of
foreign companies have decided to relocate their business
operations to India. Currently, the country lags behind China but
experts predict it will eclipse its eastern neighbor in the years
ahead. This will present a number of strong buying opportunities to
international investors as foreign capital floods into the
country.
Latin America Stock - BanColombia (
CIB
)
There are two major trends pushing growth across Latin
America-commodities and demographics. Commodities are priced in
U.S. dollars and when the dollar is weak, commodity prices go up.
This, coupled with higher demand for commodities is providing a
major currency tailwind for companies in Latin America.
But since commodity stocks are notoriously volatile, my favorite
Latin American stock is instead a financial stock. I have
recommended against buying U.S and other financial companies since
before the financial crisis, but because of the growth in Latin
America right now, banks in that region are looking very strong as
they lend to booming businesses and a more affluent population. One
of my favorites is
BanColombia S.A. ADS.
(NYSE:
CIB
), the largest bank in Colombia, which serves more than 6.4 million
customers. In addition, its Banagricola division operates 100
branches in El Salvador. BanColombia provides traditional
commercial and retail banking services, including deposit accounts,
loans and mortgages and credit and debit cards, as well as
brokerage services. The stock is up about 70% in the last 12 months
and is in the right spot at the right time for significant
profits.
As of this writing, Louis Navellier was recommending all
three of these stocks to subscribers of his Global Growth
investment newsletter.
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