Global Market Roundup - Buy or Sell?

Peter Cherry
Investmentwarehouse.com announced the following comments and summary of the most important market sectors on 29 November 2003. The views expressed here are those of InvestmentWarehouse.Com at this time. Investors should always be aware that investments can fall as well as rise in value.

US Equity - The US economy shows signs of revival and stocks continue to rise in many sectors. Economic data is positive however this may be due to the Fed pumping liquidity into the system. The US Dollar looks set to remain weak or weaken further. Our survey shows more bears than bulls t this time though the rise may continue for a while. Position: Hold to Sell

UK Equity - stock prices buoyant and there are still bargains to be had. The bank of England rate rise confirms their belief that the recovery had set in properly. Although much of the easy money may have been made already good fund managers should perform well over the next year. Position Hold to Buy

European Equity - The fall of the Dollar against the Euro could stall recovery in Europe. However, stagnant economic growth in the first half of the year has now passed to recovery and once unemployment falls a mood of quite optimism will prevail. Position Hold to Buy

Japanese Equity - Foreign capital is flowing towards the Nikkei as the economy shows signs of good growth (buoyed by the government). Still lots of trouble in the banking sector but exporters shares on the rise. Position: Cautious Buy

Emerging Markets Equity - Russia now upgraded to investment grade by Moody's, Brazil probably next in line. Eastern European stocks recently enjoyed a huge surge, then a small fall. In general emerging market funds have been excellent performers of late and the future looks bright. Position: Buy

US Bonds - If the equity markets fall then bonds will rally, otherwise avoid. Position: Sell

UK Bonds - had a good year to be sure and institutional buyers mean that demand outstrips supply. Sterling bonds look like a hold for US Dollar portfolios and a probably slow sell for Sterling investors. Position: Cautious

Technology - there are signs that the recent technology boom may turn around soon, watch the sector carefully and be prepared to bail out. The Nasdaq has risen 70% over the last year. Ericsson shares are up 250% etcetera. Still, our position is a Hold to Buy (but with caution). US Tech stocks look relatively cheap with a weaker Dollar.

China - a miracle growth story, fund sector average rose 42% so far in 2003. China could overtake the USA within 50 years and last year overtook the UK contributing 5% of global exports. Domestic consumption is stable with a growing wealthy middle class, buying electronic good and even motor cars. Manufacturing is cheap and efficient. Position: Buy

Far East and Pacific - Growth is beginning to gather pace and the weak US Dollar helps. We foresee steady, even spectacular, growth in the region. Sector average is +32% over one year, not to be sneezed at. Position: Buy

Conclusion: Plenty of opportunities for the investor here since investor confidence is returning and that alone will drive the markets for some time. Regular reviews of holdings and the ability to move speedily will still be required. Hopefully real stock values will catch up on prices in time as recovery sets in solidly. Investors with a broad based portfolio should not expect huge gains but careful management should give solid returns. There will be some big gainers in the next 12 months for those with nerve and verve.