BSE Sensex (9424.24) and Nifty (2874.80) closed 8.6% and 7.3% up respectively last week.Nifty put-call ratio was 1.21.Support for Sensex is at 9000 and Nifty at 2740.Resistance for Sensex is at 9860 and Nifty at 3000.Inflation was at 5.64 v/s 5.60 last week. Crude oil was at 42$.Markets soar up from oversold territory on the news of $819 billion stimulus package being passed by U.S.House of Representatives. L&T expressed their interest to buy Satyam to Government of India. Fiedility bought 1.71 Cr. shares of Satyam from the open market. IMF reduced the growth forecast of India to 5.1% from 6.3% in 2009 .Government announced the price cut of petrol and diesel by five Rs and two Rs. respectively. Reliance Industries got interim order from Bombay high court to sell KG Basin gas till final judgement which is expected by mid March. .Nifty 2700 put option added open interest. SAIL and RPL added open interest. SBI and HPCL shaded open interest. Huge position was build up at BHEL February put option strike price 1290 and L&T February call option strike price 680.

Tactics for Future Option players.

1)Hindalco(48.95) Lot Size-1759 Shares

Buy one call option of February strike price 50@3.85 Rs.

Sell one call option of February strike price 55@2.00 Rs.

Premium .Paid=3.85*1759=6772.15 Rs.

Premium Received=2*1759=3518.00 Rs.

Net Premium Paid=6772.15-3518=3254.15 Rs.

Maximum Profit=55-50=5*1759=8795-3254.15=5540.85 Rs.

Maximum Loss=3254.15 Rs.

Break-even=51.85 Rs.

2)Petronet(37.35) February future-Lot Size 2200 shares.

Buy one lot February future @37.35

Sell one call option of Februay strike price 40@1.90 Rs.

Premium Received=1.90*2200=4180.00 Rs.

Max Profit==40-37.35=2.65*2200=5830.00+4180.00=10010.00 Rs.

Max loss=Unlimited.

Trading Idea

1)MARUTI(568.30)Buy this stock in decline and trade.

2)BPCL(391.95)Buy this stock in decline and trade.

Trend of Major Stocks

STOCK TREND Days WeeklyTrend MonthlyTrend

BHEL.NS Bearish 2 Falling Rising

ICICIBANK.NS Bulllish 4 Rising Rising

INFOSYSTC.NS Bulllish 4 Rising Falling

ITC.NS Bulllish 4 Rising Rising

MARUTI.NS Bulllish 2 Rising Rising

SBIN.NS Bulllish 4 Rising Rising

TATASTEEL.NS Bulllish 3 Rising Rising

TCS.NS Bulllish 4 Rising Rising

Technical indicators of major Stocks

MFI=Money Flow Index

RSI=Relative Strength Index

ADX=Directional Momentum Index

STOCK CLOSE MFI-21 RSI-14 ADX-14

BHEL.NS 1320.8 46.85 44.43 12.26

ICICIBANK.NS 416.25 46.88 50.06 17.28

INFOSYSTC.NS 1306.65 69.32 61.52 22.13

ITC.NS 180.1 66.4 63.01 12.11

MARUTI.NS 568.30 75.86 55.16 20.07

SBIN.NS 1151 48.65 47.82 28.48

TATASTEEL.NS 184.6 57.04 43.03 21.96

TCS.NS 511.6 54.13 52.31 10.09

narendra nainani
http://www.articlesbase.com/investing-articles/bullet-advisory-indian-stocks-weekly-markets-soar-up-from-oversold-territory-on-short-covering-748322.html

In the late 1990’s many investors fell victim to the momentum investing craze that was sweeping the country. It seemed that no matter what stock someone bought the price of that stock would always go higher and higher. Many new investors even quit their jobs to become day-traders. Unfortunately, this all came to a crashing end when once high flying internet stocks came crashing back to reality.

Momentum investors look for stocks they feel are ready to take off with explosive growth upwards such as the internet stocks of the 1990’s. These investors buy stocks that may already be considered high priced with the belief that the stocks are going to continue to go up in price.

In the 1990’s simple news stories were sending stocks soaring even if those stories were not necessarily based on facts. Some stocks actually jump as much as 20 points in one day based on rumors alone.

Momentum investing is definitely based on the belief that an extended bull market is in effect. This method also requires a lot of knowledge about technical analysis. The biggest problem with being a momentum investor is you simply do not know for sure when your momentum will run out such as it did in the late 1990’s. While a momentum investor may have some success with an occasional huge gain; they will also more than likely get stuck with over-priced stocks that simply take a sudden and drastic turn for the worse. Many professional traders will tell you the average investor will lose if they try momentum investing, because the professional investor will always have the upper hand when it comes to drastic downturns in the market. Therefore, the average investor who is trying to chase a stock higher will be left holding the bag of a stock that will soon be crashing down.

I am personally not a fan of chasing stock prices higher. It simply is a bit too much of a gambling method for my taste. I truly believe that smart, slow, and steady investment strategies will always result in wiser investment decisions.

Chad Surges
http://www.articlesbase.com/investing-articles/following-the-crowd-with-momentum-investing-131373.html

The Individual Savings Account (ISA) scheme was set up by the government in 1999 to encourage people to save more money. It allows people to save up to a certain amount each year without paying tax on the interest or income from it. There are various different rules on what you can save and how, so we’ve broken it down into an easy-to-follow guide to give you an overview of ISAs and how you can make the most of them to boost your savings.

This guide is for information purposes only and is not intended as financial advice. For guidance on managing your personal finances, it is recommended that you speak to a qualified independent financial advisor.

Savings limit

You can invest up to 7,000 per financial year (April to March) in various combinations of ISAs without having to pay tax on either the interest gained from your savings or any capital growth or dividends made from your stocks and shares. If you mistakenly end up opening more ISAs than your entitlement allows, you’ll end up being taxed on your income from them.

Types of investments

There are three ways in which you can invest your money in an ISA – cash savings, stocks and shares and life assurance.

Maxi ISA

This type of ISA allows you to invest up to the full ISA threshold – 7,000. You can either invest the whole 7,000 in stocks and shares and life assurance or up to 3,000 in cash and the rest in stocks and shares and life assurance. All investments in a maxi ISA must be with the same company.

Mini ISA

Alternatively, you can have up to two mini ISAs in one year, one for cash and one for stocks and shares, and both of these can invest in life assurance. The limit for the mini cash ISA is 3,000 and the maximum that can be invested in stocks and shares is 4,000. You don’t have to have all your mini ISAs with the same provider.

Providers

There are lots of different providers of ISAs, all of which must be approved by Her Majesty’s Revenue and Customs (HMRC). These include also supermarkets, retailers, fund managers, financial advisors and the National Savings and Investments Bank (formerly the Post Office Savings Bank) as well as high street banks and buildings societies.

Shop around

Not all providers offer the same interest rates and stocks and shares options, so do your homework before you decide which provider to go with. Also look out for charges for managing funds with stocks and shares ISAs – these can vary signficantly.

Transferring ISAs

ISAs are very flexible – you can take your money out at any time (subject to a notice period with some accounts) and you can easily transfer an ISA from one provider to another, as long as you transfer to the same type of ISA – you can’t transfer funds from a cash ISA with one provider to a stocks and shares ISA with a different provider. You must also transfer the funds directly from one ISA to another (i.e. you can’t close down one ISA, withdraw the funds and then deposit them in a different ISA). Check with your provider whether there are any charges for transferring your ISA.

Who can get an ISA?

Anyone over the age of 16 can take out a cash ISA and anyone over 18 can take out a stocks and shares ISA, as long as they are resident in the United Kingdom. Exceptions are made for civil servants and members of the armed forces who live overseas, as well as their spouses or partners. ISAs can only be taken out in your own name – it’s not possible to have a joint ISA.

Benedict Rohan
http://www.articlesbase.com/advice-articles/getting-to-grips-with-isas-51961.html

It is easy to enter the trading world, but not so easy to stay there! The trader/investor has to select the best possible deals, if he/she wants to be associated with the trading community for a long time. The selection of deals is termed as “stock picks”.

Here, we list out all the reasons why stock picks are considered to be so crucial to day trading in stocks–

(1) If one thinks of day trading, it has many advantages–

(a) Since it is not necessary to place a particular stock position behind the current day of trading, stocks can be held even overnight. Thus, even if there are probable losses, they are not very high.

(b) Whatever be the current market condition, there is assurance of profits as well as additional leverage.

(2) Day trading is not without its disadvantages–

(a) The time period set for day trading is limited to 24 hours; so the investor/trader could easily win or lose, within just a short period.

(b) Loss of money in turn can lead to higher volatility, changing prices, unlinked markets and lower liquidity.

(3) After seeing the advantages and disadvantages concerned with day trading, it seems even more imperative to go in for stock picks. Yes, the investor or trader has to enter day trading with some knowledge about securities as well as strategies to be implemented. Even lists of stock picks necessitate that they be analysed thoroughly, before going in for actual selection of a particular stock. Adequate experience is an added bonus!

(4) The exact definition of stock picks–”stocks that are picked as per certain criteria, with the aim of reaping rich returns”. As a matter of fact, this is one among four significant strategies concerned with investments in the stock market.

(5) This is the best deal since it ensures maximum market returns for the trader or investor. If the day trader uses the intra-day volatility of the stock prices which are most active in nature, to his maximum advantage, there is no way that he/she is going to miss out on regular gains! The profits can be seen within a few hours, or days or weeks or even months.

(6) The other three strategies employed along with picking of stocks include–sector timing analysis, market timing analysis and holding and buying.

(7) The set of strategies and methodologies significant to day trading are–chart formation, technical analysis, algorithms, trend analysis, relative strength ranking, volumes and fractals. Picking of stocks is dependent on the above.

(8) A great methodology is evaluating the financial scenario of that particular company. The stock financial evaluation gives the entire history of the company’s finances. The analytical steps involved with this are–PE/Price to Earnings, PB/Price to Book Ratio, and ROE/Return on Equity.

PE = A ratio evaluation that reveals a comparison of the company’s current stock and per-share earnings.

PB = The stock market value and book value are compared.

ROE = Gives a picture of the company’s financial proficiency.

(9) Short-term selections correspond to securities that aim for a well trading immediate future. They are meant to last only for one or two days. If the price of these stocks should rise to 10% or even more in just one day, then they can be considered the best deals!

(10) Factors like EPS growth, outstanding patterns of stock charts, stock basis periods and GSA rank determine the selecting of stocks. These are companies that are associated with strongly-established industry conglomerates.

(11) Apart from the above, other factors that can have an impact are–management quality, market sizes and industry regulations.

(12) It is advisable to take the help of trustworthy stock analysts when selecting stocks. Even with an unpredictable market, the investor/trader knows where to put his money and reap profits.

(13) Other sources of information include newsletters that give advice from experts regarding active indices and stocks. Even the latest updates can be had from them.

(14) There are plenty of reliable web sites that give tips on stock picks. In fact, chat rooms can be used to interact with fellow traders or investors; this is first-hand information with the latest updates.

(15) Finally, education about stock picks in day trading can be found in good books, though the latest information may be missing.

Abhishek Agarwal
http://www.articlesbase.com/investing-articles/stock-picks-15-tops-reasons-traders-consider-them-important-703594.html

What are some fairly low risk stocks that pay a decent dividend?

What are some good growth stocks that are fairly low risk with a good chance of an upside?

It seems like most stocks are around their 52 week high & buying at the high makes me nervous.

Look at Linn Energy ( LINE)…. right now around 25.50…. should actually creep higher… at $24…is a 10 % div… !!! but it won’t fall that far….. some now will be around 9.5 %( annual) and get your first taste in May…

Recent recommendations of the Trai, if accepted, will connect the 330 million plus mobile and fixed-line phone users to computers and usher in a new era of net telephony. It will also give subscribers freedom to choose a carrier of their choice for STD and ISD calls. There is apprehension that Trai directives are bound to affect the bottomlines of major telcos. In addition to increasing competition among service providers, new formidable competitors such as PowerGrid, RailTel, Sify, AT&T, British Telecom, Gail and Tulip Telecom who have fibre networks in India, are expected to emerge on the overcrowded Indian telecom landscape. But what is forgotten is that the basic concept of Internet telephony has to spread in India, for existing competitors to feel the pinch. A PC is required to take advantage of the STD and ISD facilities; however, PC penetration in India is very low. One also needs a good broadband connection and reliable power supply, all deficient in this country. The stock market seems to believe this is negative for telecom companies. However, I believe the telecom industry still has great times ahead. Heres why ?

India has emerged as the fastest growing mobile market. Over 7 million new connections are added every month. Focus has so far been on the subscriber additions per month. As the telecom market reaches maturity stage, their valuations are getting eroded. Most analysis of the telecom sectors centers around MOU (Minutes of usage) per subscriber per month and the ARPM (Average Revenue Per Minute). Bharti Telecom has recently announced that the average revenue per minute which had fallen 5 per cent to 72 paise in the March 2008 quarter, fell further to just 66 paise in the quarter ended June 31, 2008, a drop of 8 %. However, the MOU (Minutes of usage) per subscriber rose from 507 in the previous quarter to 537 in the quarter ended June 31, 2008. Every time a telco announces its results, it is given a thumbs-up or thumbs-down by the capital markets depending on whether its Minutes of usage per subscriber and subscriber additions are in the positive or negative. This method of stock valuation is, in my opinion, taking a very parochial view of the tremendous potential of the telecom sector.

I believe Indian telcos are positioning themselves well for changing trends. Bharti Telecom and RCOM are selling part of their stakes in the towers infrastructure or to spin off their towers infrastructure into a separate subsidiary, and thus realize value for their shareholders. Nokia, the worlds largest maker of mobile phones, has been experiencing extraordinary rates of growth (recently reported 13 % year-on-year rise in earnings) thanks to its presence in emerging markets which has kept it relatively insulated from any western downturn. The current spread of global meltdown to the Asian continent is somewhat tapering off its growth targets though.

What is forgotten is that the global telecom sector is fast changing and the worlds biggest telecom companies are rushing to add capacity (even though they are located in matured markets) to add capacity on inter-continental routes, to meet escalating demand fuelled by consumers downloading bandwidth-hungry video content from YouTube, iTunes and other sites over broadband networks. Disruptive technologies that have begun to surface in the telecom sector will power rapid growth in this sector and result in significantly higher stock valuations, when the capital markets of the world finally recover and gather momentum.

According to TeleGeography Research, the Washington, DC-based telecoms consultancy, the increasing capacity requirements on subsea cable systems connecting the continents of the world has been driven by the emergence of content-rich network applications and the growth of the internet, which in turn are warranting upgrades to existing routes, as well as construction of new cables on the less served routes. According to Gary Breuninger, Global Crossings chief marketing officer, With more than a terabit of capacity in the Atlantic, Global Crossing has experienced annual increases of more than 60 per cent in demand between 2004 and 2008. It has made strategic investments in enhancing capacity on its mid-Atlantic crossing undersea fiber-optic cable system to meet growing demand for internet protocol and Ethernet transport among its corporate and other customers.

There is also need to build additional redundancy into the network undersea cables as a protection against damage and failure. The disruption in internet service in Middle Sea and South Asia that was the fallout of three undersea cables getting damaged is a grim reminder. According to Telegeography, at least 25 new cables, costing about $ 6.4 Billion, will be built between 2008 and 2010. The reasons for cable construction are often a combination of several factors : including dwindling available capacity on some cables, a desire for wider restoration options, the need for physically diverse routes, competition and high capacity prices in some regions of the world.

In 2001, only 30m households worldwide had access to broadband internet connections. By the end of 2007, that figure had grown to more than 337 m households. INDIA will soon see its first spectrum auctions for 3G and for broadband wireless access (BWA). 3G technology has made its mark today in several parts of the world. Prices of network equipment and handsets have fallen, making 3G affordable, and technology itself has improved. High speed packet Access (HSPA), the packet-data upgrade of 3G, delivers today about 5 Mbps average data throughput at each cell tower per 5 MHz of spectrum. The latest evolution of HSPA is claimed to support as high as 15 Mbps throughput. New YouTube-like applications bringing in enhanced revenue become possible. This is the opportune time for Indian operators to embrace 3G.

Video the new driver of internet traffic growth :

According to TeleGeography Research, the Washington D.C.-based telecoms consultancy, video is now the primary driver of internet traffic growth. Applications such as YouTube, the iTunes online store, and peer-to-peer such as BitTorrent, are helping internet users consume staggering amounts of bandwidth.

DoT has recently cleared allocation of 3G spectrum to BSNL and MTNL and India will soon see its first spectrum auctions for 3G and for broadband wireless access (BWA) services. Third generation mobile phone services allow users to surf the Internet or download content, including music and video, at speeds faster than current technologies deployed on Indian networks allow. 3G is expected to ring in revolution in the broadband access space and is coming at the right time since the telcos are peaking in terms of new customer additions in the metros. It will also enable the government to achieve the target of 20 million subscribers by 2010 and further its initiatives of e-governance and m-commerce. Prices of network equipment and handsets have fallen recently, making 3G affordable, and technology itself has improved. High speed packet Access (HSPA), the packet-data upgrade of 3G, delivers today about 5 Mbps average data throughput at each cell tower per 5 MHz of spectrum. The latest evolution of HSPA is claimed to support as high as 15 Mbps throughput. New YouTube-like applications bringing in enhanced revenue become possible. This is the opportune time for Indian operators to embrace 3G. Apples 3G i-Phone has and will in addition to the factors mentioned above significantly change the way we talk, communicate, advertise and the factors influencing our entertainment, eating habits and investment of monies. The 3G iPhone combines three products in one a revolutionary phone, a widescreen iPod, and a breakthrough Internet device. With entertainment being big business in India, 3G with its multimedia applications capabilities does offer a huge potential opportunity.

WiMax and Wifi technologies to benefit telecom industry :

These technologies can offer voice and data to stationary as well as mobile terminals. WiMax can also be used in conjunction with Wifi for reducing the cost of the terminal equipment for deployment in rural areas. These technologies about to be deployed in a big way will play an important role in implementing e-governance, e-learning and tele-medicine.

Mobile/cell phone advertising : The next big thing after online advertising :

The latest mode to invade the advertising world is AdRBT (Ad Ring Back Tone). Via AdRBTs, each time a person calls, he will hear an ad instead of a ring tone. This product has the maximum reach as compared to other ad products that include advergaming, adfunded content and WAP advertising. RCOM created one of the first of its kind AdRBTs for the Reliance Power IPO in January 2008.

Reliance Power jingle was estimated to have been heard 800 million to 1000 million times, which is 3-5 times over other traditional media. One of the campaigns of Tata Teleservices was with Parachute advanced hair oil, to promote the balladic flavour of their jingle Tum Ho Gorgeous Hamesha. During IPL (Indian Premier League) cricket series, there were 8,00,000 downloads of the jingle Cricket Ka Karmayudh in 45 days, thus fetching significant revenues to the telecom operators. AdRBT is non-invasive and has mass reach.

Tracking Stock quotes and mutual fund portfolios/NAVs on mobile phones : Fidelity AMC and ICICI Prudential AMC have started allowing investors to check portfolio values and transaction details 24*7. Against the backdrop of complaints of non-arrival of account statements in time, investors can real-time check the NAVs, their portfolio values and even switch and make additions/redemptions from the click of a button. This will enhance the usage of mobile phones and will enable investors to manage their investments anytime, anywhere.

Mobile/cell phone gaming revenue : Is it a Home run ?

Research firm Gartner predicts that mobile gaming revenue will experience a compound annual growth rate of 10.2 % between 2007 and 2011 with worldwide end-user spending reaching $ 6.3 Billion in 2011. India is expected to lead among Asian countries in terms of total mobile gaming revenue generated, with the 2007 figure at approximately $ 80 Million. Mobile gaming revenue is forecasted to reach $ 450 million by 2012. One can download a high-end game on a mobile for charges varying between Rs 50 to Rs 100. For a relatively small sum, consumers can enjoy the game again and again, as opposed to paying a huge sum upfront. On a per game basis, Gaming Hungama could charge anything between Rs 20 to Rs 150. The pay-per-play cost with Jump Games (on Reliance) could be anything between Rs 5 to Rs 10. Players like Breakpoint, Glu Mobile, Gameloft, Player One, Mophun, Electronic Arts are quickly moving in.

Mobile banking to get popular : With almost 41 % of Indias 1.1 billion population unbanked, mobile payment platform providers foresee a huge market in facilitating micro-lending services or variants thereof on mobile phones at reasonable costs. Estimates put customers for mobile banking services at between 50 million and 100 million over the next two years, by when India could be home to nearly half a billion mobile phone users, up from about 300 million today.

Mobile messaging set to replace e-mails : Mobile messaging will help organisations to overcome the physical and economic barriers of mass reach, leading to reduction of costs and increase in efficiencies and productivity through real-time communication.

Rural growth an important growth driver :

Some two billion new subscribers are expected to start using mobile phones in the next five years, and 80 % of them live in developing world markets. To power mobile networks in remote areas today, telecom operators pair base stations the tower-top radio transmitters that form the backbone of mobile networkswith diesel-powered generators and batteries. The fact that fuel is 65 % of the cost of operating a typical base station acts as a dampener.

Telecom giants such as Telefon AB LM, Ericsson, Alcatel-Lucent and Motorola Inc. are all looking into how they could tweak existing telecom gear to run on less electricity, or on renewable energy. Ericsson and Alcatel-Lucent have separately installed about 400 solar-powered base stations in African countries, including Senegal and Uganda. In India, Ericsson has installed some 40 base stations that run ob biodiesel, essentially recycled cooking oil. Alcatel-Lucents solar base station runs with 750W, while Ericssons requires 600W.

VNL (Vihaan Networks Ltd) has developed a simplified base station (costing $ 3500 or Rs 1.5 lakhs) powered by solar panels and consuming just 100W, about the same as an electric bulb. In comparison, GSM stations most widely used today can cost anywhere from $ 40,000 to $ 100,000. Rural telephony is the opportunity to bridge the digital divide between urban and rural India.

4G technology making its appearance on the scene :

One standard known as IEEE 802.16e (belonging to the Mobile WiMax family) is now commercially available and is a curtain-raiser to 4G. Its cell throughput per MHz of spectrum today may be comparable to that of HSPA; but its total data rate scales with higher transmission bandwidth. Soon, the next-generation 802.16m will be standardised as a candidate for 4G, and promises to provide data throughputs of the order of 100 Mbps in 15 MHz spectrum. Another OFDM-based standard, LTE and its cousin LTE-A will become a candidate for 4G with similar throughput. Such a high throughput will enable wireless broadband to compete with copper-based DSL widely available today. India is about to witness a wireless revolution.

Currently underserved areas including Africa, Caribbean and Middle East are fuelling demand for cable capacity addition :

Google, the internet search and advertising company, is one of six groups that announced plans to build a 10,000 kilometre high-bandwidth subsea fibre-optic cable linking the US and Japan. Other partners in the $ 300 Million Unity consortium include Indias Bharti Airtel, Global Transit, KDDI, Pacnet and SingTel.

AT&T, the largest US telecoms group, is involved in six international cable consortium projects including the Trans-Pacific Express, which it joined along with Japans NTT DoComo in early 2008. Other participants in that project include Verizon and a handful of Asian carriers including China Telecom, China Netcom, China Unicom, Korea Telecom and Chungwa Telecom in Taiwan.

Caution must not be thrown to the winds : HSPA evolved by restricting CDMA techniques to a large extent (limiting it to a spreading factor of 16) and co-opting developments associated with the emerging 3.5G/4G OFDM wireless technology. However, it lacks the wider transmission bandwidth (typically 15-20 MHz); 4G technology is being built brick by brick using OFDM (Orthogonal frequency division multiplexing) technology. The government and the regulators must act not only to ensure that spectrum is not under-valued but also that there is no over-valuation which could in the long run affect the customers and broadband penetration. Almost 30% of what we as consumers pay today goes to the government by way of service tax, licence fees, spectrum charges, USO charges, customs and excise duties, sales tax, and the like. Operators need to understand technology deeply and not go by vendor hype. Such hype had significantly contributed to unrealistic bids for 3G spectrum in Europe.

The disruptive technologies making their mark in the telecom sector have the potential to transform the way we live our lives, ensuring rapid growth and significantly higher telecom stock valuations. It is no wonder that even a market-savvy company like Google which made its mark on the online advertising map and has been a darling of Wall Street has now changed its focus to the mobile / cell phone arena to power its growth in years to come. It will be in Indias interest to see that both 802.16m and LTE-A compete as 4G standards in the Indian market. India should influence availability of handsets which support both the standards, and priced no more than a single-standard handset. The similarity of the two standards makes this technologically feasible. India is a large enough market to be able to demand convergence. Google hopes to hook the millions of mobile phone subscribers in India who do not use data or SMS-based services with its voice-based search. It is in the process of automating voice search service and is collecting voice and dialect samples from users in Hyderabad and Delhi. Analogous to Just-Dial, another voice-based search engine; consumers will be asked to call up a toll-free number from either a landline or mobile and request the information they need. Google will either deliver the information through an SMS or read it out. The mobile phones of the future will be embedded with disruptive technologies that dramatically transform the way we search, analyze and retrieve voice and data.

Note : Mr Sunil Kewalramani is a WHARTON BUSINESS SCHOOL MBA. He is the CEO, Global Capital Advisors. He may be reached at worldequity@sunilkewalramani.com.

Mandatory Disclosure : It may safely be assumed that I own telecom stocks in global equity markets, and would have advised my clients on stocks on lines similar to the opinion I have expressed above.

Sunil Kewalramani

The right Latin America will thrive in the New Year, fueled by ts own growth with an assist from the continued hot growth from China while the wrong Latin America will get left behind.

The second phase of emerging markets expansion is well on its way a period of self-sustaining growth, driven by consumer growth and infrastructure spending. And Latin America, following China and other Asian economies, is one of the key global pillars of growth that will save the global economy and the U.S. financial system from total collapse. But not all the countries in Latin America will go on to prosper. There is a wide gulf in the policies that will continue to separate the winners from the losers.

Let me explain.

In a recent article in our affiliated monthly newsletter
, The Money Map Report, Money Morning Investment Director Keith Fitz-Gerald made three important points:

• The emerging markets (of which Latin America is the second-most-important leg) will play a growing role in the continued long-term growth of the world economy.
• The U.S. economy will continue to grow long-term, but its relative importance in the world economy will continue to decline.
• In the near term, the emerging markets could well play a determining role in keeping the overall global economy and the U.S. financial system from dropping into a depression-like funk that we wont be free of for years. Emerging economies in Asia and parts of Latin America have huge cash reserves, much of which will be invested in infrastructure projects over the next 20 years.

In the next three years, China, alone will invest as much as $725 billion in infrastructure, while Brazil will invest $225 billion for the same purpose.
This is important to remember, given that the dramatic sell-off the emerging markets have experienced has many investors doubting the ability of these countries to decouple from the global economy. The reality of the situation is that most investors and pundits are failing to differentiate between economic decoupling and market decoupling.

The Gloomy Present

While growth in emerging economies has dropped slightly, the prices of securities and currencies in emerging markets has fallen drastically. Many investors think that the U.S. economic crash will lead to a dramatic drop in U.S. orders of emerging-market products, which will cause those economies to drop off. That, in turn, would squeeze the profits and market valuations of the companies that operate in these economies.

But thats a mistaken assumption. And heres why.

In Brazil, for instance, exports account for a mere 13% of gross domestic product (GDP). In China, exports are just 10% of GDP. So some contraction in U.S. and European orders can easily be counterbalanced by fiscal and monetary stimulus in these countries.

On Oct. 27, in the depths of a rabid, indiscriminate sell-off, I published an extremely bullish piece on Brazil. Since that article was published, Brazil went on to rally as much as 47%. As of Fridays close even after some subsequent profit-taking the exchange traded fund (ETF) that represents the Brazilian market (EWZ) is still up 21% (and has risen as much as 42% since my recommendation).

And most emerging markets economies have plenty of fiscal and monetary maneuvering room. Leading the pack is China, which accounted for some 27% of global growth last year, and which has continued to use both fiscal and monetary tools to keep itself on a solid growth path.

It recently slashed interest rates again, down to 6.66% (a lucky number in the Chinese culture, meaning things (are) going smoothly). With record foreign reserves of $1.9 trillion, China also approved a fast and heavy-handed $586 billion stimulus, mainly in housing and infrastructure, to be implemented through 2010. And the Chinese yuan will drop almost 7% vis-a-vis the U.S. dollar to cushion losses in trade. It has also lowered taxes on investments in capital goods. And in a key move thats been almost totally overlooked by the media, China has made huge market-oriented reforms in agriculture.

China has just allowed its 780 million farmers to rent, transfer or utilize as collateral their rights to their lands and eliminated all taxes on agricultural production and to farmers. This will allow for a massive increase in the scale of production by consolidating companies. In this way, China will keep its 120 million hectares dedicated to agriculture exclusively, with no possibility of urbanization, while at the same time allowing the millions of small farmers to sell out, and get capital to move to the cities. This will not only increase the productivity of Chinese farming dramatically by allowing for economies of scale to work and attracting billions in investments, it also will create a huge incentive for these millions of farmers to move to the cities, boosting housing and infrastructure demand.

Brazils plans are very similar to those of China. Theres a:

• Strong fiscal stimulus, allowing a drop in the value of the real currency (a decline thats already been substantial) in order to cushion exports.
• An easing of capital requirements to Brazils strong banking system, which will incentivize housing and car loans.
• Export financing.
• And huge local infrastructure projects.

There is another little-understood phenomenon that cushions the blows for emerging economies: Intra-emerging market trade has become increasingly important. By now everybody understands that iron ore from Brazil and coal and oil from other emerging markets is flowing into China in order to fuel Chinas massive infrastructure buildup and growing consumer demand.

The Breakdown on Brazil

Increasingly, a growing proportion of the infrastructure needs of industrial goods being bought by emerging economies are goods produced by other emerging economies. Trade between Latin America and China has increased by 13 times since 1995, from $8.4 billion to $100 billion. And China, now the second-most-important commercial partner to the region after the United States, has finally been accepted as a member of the Inter-American Development Bank, committing itself to contribute $350 million to the bank. As an example of this growth in industrial trade, Argentina just bought 279 subway cars from Chinas CITIC Group.

However, not all trade with China has been successful, due to Chinas notable deficiencies in quality control, especially in health standards. For example, Latin American imports of medicines manufactured in China had catastrophic results in Panama two years ago, where more than 100 people died and hundreds more became ill from medications containing toxic Chinese glycerine. Recently, Panama detected toxic chemicals in imported Chinese sweets and crackers and Argentinas customs recently seized Chinese 20,000 thermos containers for having elevated content of toxic chemicals.

And all of this means that there is a market disconnect between the prices of Brazilian shares and those elsewhere in Latin American equities and the fundamentals of the underlying companies, that we will see played out in the next and subsequent years. Why?

Just because huge financial losses by banks precipitated a massive de-leveraging cycle, which means they had to sell their holdings, regardless of merit. And that included big sell-offs in preferred investments, including the hugely promising and profitable Petroleo Brasileiro SA (Petrobras) (ADR: PBR), Vale (ADR: RIO), and many others.

And what is worse, their sales hit the stop losses of major hedge funds, who were also leveraged in such favorite plays as commodities, steel, coal, agro, emerging markets and even defensive stocks such as the U.S.-based Pepsico Inc. (PEP).

When you have the proprietary positions of banks and hedge funds all trying to get out of the same door at the same time because of risk management issues, you get the current disconnect between market fundamentals and pricing.

Another impact that we have to understand is that the ongoing dramatic interest rate drops in all major G7 economies and the more than $3 trillion in G7 fiscal programs will have a marked impact on growth next year, containing what would have been a much nastier economic contraction. But while G7 countries will barely grow between negative 0.5% and a positive 1% in 2009, with the worst contraction front-loaded and recovering in the second half, emerging economies will grow at a minimum of 4%, and in the case of China maybe as high as 10%.

In my October Brazil analysis, I detailed the massive stress that Brazil came under in 1995 because of another exogenous shock: The Mexican devaluation, the so-called Tequila effect, which ricocheted around the world, and which caught Brazil in 1995 in a much weaker position than it is in today. Back then, Brazil had a much higher level of debt, much lower reserves, a fiscal sector that needed huge reform, and a much lower capacity for exports. Brazil dealt with this massive stress effectively and went on to work at each one of its weaknesses in the next 13 years, getting itself into a position of strength today.

While having the temptation and the perfect excuse for a default right at hand, Brazil proved its seriousness back then by taking the hard, but certain road to progress, keeping its international commitments and gradually affecting strong structural reforms. Since then, it has become a net creditor to the world; it controlled inflation, and avoided an overheating of its economy with tight fiscal and monetary policies during the recent run-up in commodity prices.

This is paying off strongly today. The policies, run day to day by a sophisticated technocracy led by top economists and international bankers, many of which held top positions in leading international banks, has allowed Brazil to move forward and to anticipate GDP growth of 4% to 5% for the New Year.
Hence, Brazil is by far my favorite Latin American play for 2009.

Checking Out Chile

Following closely behind, and hindered only by its small size, is the poster child of fiscal and monetary prudence: Chile.

Chile, which came out of its 1970s default by eliminating its foreign debt and successfully restructuring its banking system, has made every effort to maintain very prudent fiscal and monetary policies and to diversify its exports away from copper, which, being the largest exporter of the metal in the world, still accounted for 38% of its GDP.

Today, Chile exports many diversified products, including agricultural products, wine, fertilizers and industrial wares. And because its situated on the Pacific Coast, it is geographically well positioned to trade with the fastest-growing markets in the world China and the other emerging Asian tigers.

But Chile, in order to minimize the cyclical nature of its economy due to the wide fluctuation in the price of copper, decided years ago to start a rainy-day fund, which would accumulate wealth in the good years and be used to soften the blow in the bad ones. Now, Chile boasts a $28 billion sovereign wealth fund, accumulated almost completely from its copper profits. Thats almost equal to a staggering 14% of the countrys GDP in cash savings! This will enable Chile to implement counter-cyclical policies to keep growing at 3.5% to 4% next year or about the current rate of growth, even with the worldwide meltdown.

Chile already has started to deploy this capital, having passed a $1.15 billion government plan on top of last months $850 million to stimulate housing and small-business lending, injecting that capital into a government bank that will make available loans for small businesses.

Avoid Argentina

Chiles fiscal prudence is in direct contrast to Argentinas lack of discipline. Argentinas Peronist government, which squandered the agricultural commodities bonanza in fiscal spending, is now is trying to use its majority in both houses in Congress to pass the nationalization of the privatized pension funds under the excuse of protecting them from market volatility.

These funds, which now have successfully grown to more than $30 billion in size, or 73% of the governments budget and have returned an average of more than 13% a year since inception will allow the government to cover its fiscal gap and debt maturities next year and to financed public works and consumption projects. The government, at the same time, is suffering from an important loss of confidence, as evidenced by its need to resort to police controls in order to prevent the illegal purchase of U.S. Dollars. Argentina might end 2009 with growth of negative 2% and unemployment of 10%. Stay away.

A Maybe for Mexico

Mexico, given its strong links to the United States, is receiving a heavy dose of external shocks on many economic and financial fronts especially where the United States is concerned: Its being hit by a drop in exports (the United States is the main component), the drop in oil prices, lower tourism (its largest proportion of travelers is from the United States), falling U.S. investments in Mexico, and reduced remittances from Mexicans working in the United States back to their Mexican relatives.

In addition, many companies suffered strong losses in their derivatives hedges, banks have had to reduce lending due to reduced liquidity and the Mexican peso has lost some 22% of its value against the U.S. dollar. Mexicos growth in the New Year may fall to about 1% from 2008s 2.4% pace, and the country is on its way to approving the first budget with a fiscal deficit in four years. The governments target will be negative 1.8% of GDP, in order to stimulate the economy. Mexico, seeing its oil production declining, is seen moving soon towards opening some oil areas for exploration and development, which some estimate could add another 1% to GDP.

Once the U.S. markets have stabilized, Mexicos stocks will be an incredible buy once more, since they discount a very bad scenario at these prices.

A Case Against Colombia

Colombia, another country that has merited a lot of attention, given its staunch support of U.S. anti-drug and anti-money-laundering efforts, has seen its free trade agreement with the United States inexplicably delayed.

The country foresees a tightening of credit conditions, so it is moving up its peso-based borrowing to this year. Next year it will issue only $1 billion in foreign bonds and tap $1.4 billion from multi-lateral lenders. So the refinancing risk for Colombia is muted, given the small amounts involved, and the countrys economy should expand a minimum of 1% in the New Year, even in the worst economic scenario. However, Colombia could grow as much as 4% under a moderate scenario.

That would represent a big drop from the 8% growth recorded this year.

The story in Colombia has been the curbing of inflation, and how far behind the curve the central bank has been, at least as recently as July, when it boosted rates up to 10% and then kept them there.

These ultra-high interest rates, combined with the global slowdown, have blunted demand for consumer products in Colombia. Since the passage of the trade pact is a situation in flux, I want to wait and see right now.

I will not go into the economies of Venezuela, Bolivia and Ecuador, which, with massive intervention by their governments and advances against property rights, are experiencing severe economic and political stress, and which do not offer the guarantees needed for foreign investment.

Editors Note: Money Mornings Outlook 2009 economic forecasting series last looked at the energy sector specifically coal and nuclear power in the New Year. Watch for the series to continue. Check out past series stories, which have underscored that uncertainty will continue to be the watchword for at least the first part of the New Year. Little wonder, as the global financial crisis continues to whipsaw the U.S. financial markets in a manner that hasnt been seen since the Great Depression. Its almost enough to make you surrender. But what if you knew, ahead of time, what marketplace changes to expect? Then youd be in the drivers seat right? Youd know what to anticipate, could craft a profit strategy to follow, and could then just sit back, watching and waiting and finally profiting from the very marketplace events you anticipated.

R. Shah Gilani a retired hedge fund manager and a nationally known expert on the U.S. credit crisis has predicted five key financial crisis aftershocks that he says will create substantial profit opportunities for investors who know just what these aftershocks are, and how to play them. In the Trigger Event Strategist, trigger events, as gateways to massive profits. To find out all about these five financial-crisis aftershocks, and about the trigger-event profit strategy they feed into, check out our latest report.]

News and Related Story Links:

• Money Morning Buy, Sell or Hold Feature:
  Buy, Sell or Hold: iShares MSCI Brazil Index.
• Money Morning Global Investing Roundups:
  Brazil ETF Rises as Much as 42%.
• Money Morning News Analysis:
  Massive China Stimulus is Viewed as an Attempt to Help the West.
• Money Morning News Analysis:
  With its Pension Fund Grab, is it Dj Vu All Over Again For Argentina?

ShareThis

More on this topic (What’s this?)

China Blasts U.S. Economic Policy, Expresses Doubt in Financial System (Contrarian Profits, 12/5/08)

China’s Economic Slowdown Accelerated in November (naked capitalism, 11/26/08)

Roubini Foresees Chinese Hard Landing (naked capitalism, 11/5/08)

Why China Cant Save The Global Economy (Contrarian Profits, 12/5/08)

Read more on Investing in China at Wikinvest

IMF Quietly Creating Three 100%+ Winners

The International Monetary Fund is about to pump $100 billion into a few select countries. This no strings attached bailout is creating three 100%+ gainers in the coming days – if you know how to play it. Get all the details in this report: The Trigger Event Strategy: The Only Proven Way to Make Money in an Insane Market. Just go here…

Investing News

Money Morning
http://www.articlesbase.com/investing-articles/some-latin-american-markets-show-profit-potential-in-the-new-year-while-others-pose-risk-685997.html

China has decided to end further investment in the US and pour it backinto itself. Foreign investors are avoiding all US investments and are buying China stocks. China is still expected to growby 8%in 2009, true its less than its previous annual growth of %11 but it still great, when considering that the US is expected to grow only %2 in 2009.Chinese are still buying like crazy, they want better and more comfortable lifestyles. Chinese banks have not been exposed to the recent sub-prime disaster like other banks around the world. China is stillgrowing like crazy,and does not seem to be slowing up any time soon.

Here are some Chinese Stocks which have also changed trend recently, they have gone up a lot since December, and they are all just recently started uptrendsalong with China’s Index.

1. ACH (Aluminum China)
This stock looks like it has bottomed in October. November’s low is higher than October’s low. ACH has just recently closed above its 50-day EMA . MACD positive.

2.PTR (Petrochina Co Ltd Adr)
MACD turned positive, it hasn’t done that since last April. Just began an uptrend (higher highs and higher lows). PTR has recently closed above its50-day EMA, another very bullish sign.

3. CAAS (China Automotive Systems Inc)
This stock has been in a nice uptrend since December. MACD positive. Recently closed above its13 and 50-day EMAs.

4. NCTY (THE9 LTD)
This stock has been in a nice uptrend since December. MACD positive. Recently closed above its13 and 50-day EMAs.

5.SHI (Sinopec Shanghai Petrochem Co)
This stock has been in a nice uptrend since November. MACD positive. Recently closed above its50-day EMA.

Shoshana Antelman
http://www.articlesbase.com/investing-articles/5-chinese-hot-stocks-to-buy-now-719669.html

China has decided to end further investment in the US and pour it backinto itself. Foreign investors are avoiding all US investments and are buying China stocks. China is still expected to growby 8%in 2009, true its less than its previous annual growth of %11 but it still great, when considering that the US is expected to grow only %2 in 2009.Chinese are still buying like crazy, they want better and more comfortable lifestyles. Chinese banks have not been exposed to the recent sub-prime disaster like other banks around the world. China is stillgrowing like crazy,and does not seem to be slowing up any time soon.

Here are some Chinese Stocks which have also changed trend recently, they have gone up a lot since December, and they are all just recently started uptrendsalong with China’s Index.

1. ACH (Aluminum China)
This stock looks like it has bottomed in October. November’s low is higher than October’s low. ACH has just recently closed above its 50-day EMA . MACD positive.

2.PTR (Petrochina Co Ltd Adr)
MACD turned positive, it hasn’t done that since last April. Just began an uptrend (higher highs and higher lows). PTR has recently closed above its50-day EMA, another very bullish sign.

3. CAAS (China Automotive Systems Inc)
This stock has been in a nice uptrend since December. MACD positive. Recently closed above its13 and 50-day EMAs.

4. NCTY (THE9 LTD)
This stock has been in a nice uptrend since December. MACD positive. Recently closed above its13 and 50-day EMAs.

5.SHI (Sinopec Shanghai Petrochem Co)
This stock has been in a nice uptrend since November. MACD positive. Recently closed above its50-day EMA.

Shoshana Antelman
http://www.articlesbase.com/investing-articles/5-chinese-hot-stocks-to-buy-now-719669.html

One way of making your money grow is investing in the stock market. Stocks are how companies grow without securing bank loans. The investor buys the company stock (shares) and receives interest in the form of stock dividends. Share holders can affect the operation of a company. Each year, there is a share holders meeting and different issues are presented for the share holders to vote on. The greater the number of shares that an investor has, the greater the number of votes the stock holder can exercise.

There are several categories of stocks. Income stocks provide revenue to the stock holders in the form of dividends. growth stocks are shares sold by companies that reinvest their profits to increase the size of the company. You can invest in stocks online, through stock market investors or directly, as in the case of Coca Cola and a number of other companies. Some companies provide their employees with stock options allowing them to purchase stocks at a given price for a particular period of time. There are also Over the Counter Stocks. These are not listed on any exchange and are sold by smaller, riskier companies that do not meet the requirements of the exchanges.

There are a number of reasons why stocks rise and fall in value. If a company is doing well, the value of a stock will increase. Conversely, if a company is not doing well, its stock prices may fall. Other factors affect the market value of shares. The price of crude oil will affect the market value. Disasters or wars will force prices downward. The introduction of new federal regulations for an industry will have an impact, depending on how the legislation affects production. Changes in company management also have an affect on stock prices.

Stock brokers buy and sell stocks on behalf of investors. They also provide information to their clients regarding the best times to buy and sell based on the market value of the stocks and whether they are rising or falling in value. Today anyone can be a stock broker thanks to the internet. Investment companies permit their clients to use their services to research a stock or give advice on buying and selling. The investor is then able to purchase or sell stocks online at a cost of so much per “trade.”

Everyday the stock averages are compiled and made public. The Dow Jones Industrial Average provides details on 30 large industrial stocks, including General Motors, Goodyear, IBM and Exxon. The Standard and Poor 500 Index provides averages for 500 large companies. There are three major stock exchanges in the United States. These include NASDAQ (National Association of Securities Dealers Automated Quotations), Amex (American Stock Exchange) and the New York Stock Exchange.

The Securities and Exchange Commission (SEC) protect investors; maintains fair, orderly, and efficient markets; and facilitates capital formation. It mandates that companies provide financial information to individuals before they buy stock and to continue providing relevant financial information as long as the investor holds the stock. The SEC also oversees securities exchanges, securities brokers and dealers, investment advisors and mutual funds. The SEC has an obligation to enforce the nation’s securities laws. Each year hundreds of actions are taken against individuals and companies for insider trading, accounting fraud, and providing false or misleading information about securities and the companies that issue them.

The SEC works closely with Congress, other federal departments and agencies, the stock exchanges, state securities regulators, and various private sector organizations.

Joe Goertz
http://www.articlesbase.com/advice-articles/making-your-money-grow-in-the-stock-market-69963.html