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The Money Map Advantage
Thursday, November 17, 2005
By Horacio Marquez
#18
** Another Brazilian Samba Propels Our Profits
I am in Shanghai right now, and it is bustling with activity and growing at a mind-boggling pace. I hear construction crews working around the clock. My trip here has not only been a pleasure, but it has clarified a great list of pending questions for me about China and its stock market, which will enable me to bring you some highly attractive plays as we get closer to the end of the year.
In Brazil, the market rallied yesterday for a gain of about 2%, led by Petrobras (NYSE: PBR) and mining stocks. Petrobras notched up on higher oil prices, more than 3% yesterday, and has been rallying since last Friday. The company recently reported that its stock has been over-discounted from the drop in oil prices. The outlook looks very promising, as the global economy is running on all cylinders and the seasonal sell-off in energy is behind us.
This should also help Tenaris (NYSE: TS), which rallied yesterday. And a temperature drop in the northeastern U.S. should be more supportive of energy stocks.
Despite the Brazil rally, Banco Bradesco (NYSE: BBD) was down 0.6% yesterday, and some 1.5% since Monday. It is consolidating these levels and preparing for the next big move up. Bradesco has been stronger than its local rivals – Banco Itaú (NYSE: ITU), down 1.6%, and Unibanco (NYSE: UBB), down 3%. This evidences the superb metrics and prospects of Bradesco, envied by most banks around the world. Brazilian banks should continue to benefit from the acceleration of the economy into the elections next year.
Our iShares MSCI Japan (AMEX: EWJ) and Mitsubishi UFJ Holdings (NYSE: MTU) have consolidated and are ready for another strong leg up. Yesterday, Japan had a nice rally led once more by financials and the Japan Topix banks index, which should continue to deliver stellar performance. The government does not seem ready to restrict liquidity yet. Therefore, Japanese monetary policy will continue stimulating the economy. This is improving the loan portfolios and balance sheets of the banks, propelling their results and stock shares to new highs.
We continue to be extremely bullish on Japan, as the economic restructuring process continues, led by Prime Minister Junichiro Koizumi, a strong free-market reformer and U.S. ally.
Similarly, the S&P is consolidating recent gains after breaching the resistance at 1,285. It rallied above the mini-bearish channel into the close yesterday, and it’s ready for a strong jump up, which cannot be far away.
Cerner (Nasdaq: CERN) is giving up about one-third of its recent 6% gain. However, it is on track for bigger gains ahead.
I am off to catch a short nap, as I begin the journey home later today.
Enjoy and profit,
Horacio Marquez
If you have any questions, feel free to call one of our VIP Trading Services representatives at 888.570.9830 (toll-free) or e-mail: viptrader@oxfordclub.com , or contact Pillar One Advisor Greg Galloway at 800.438.3040 or 407.667.4729.
Stock
Current Price
Comments
Banco Bradesco (NYSE: BBD)
$57.85
Buy. Sell stop is $40.
Petrobras (NYSE: PBR)
$64.28
Buy. Sell stop is $55.
Mitsubishi UFJ Finan. (NYSE: MTU)
$12.83
Buy. Sell stop is $10.20.
iShares Japan Fund (AMEX: EWJ)
$12.17
Buy. Sell stop is $10.
Cerner Corp. (Nasdaq: CERN)
$92.81
Buy. Sell stop is $62.25.
Tenaris (NYSE: TS)
$109.35
Buy. Sell stop is $95.
MSCI Austria Fund (AMEX: EWO)
$25.33
Buy. Sell stop is $20.90.
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As Of 6:11AM 3/26/2009
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