Famed international fund manager Mark Mobius is one of Bloomberg's favorites; I see a story quoting him just about every week in their news stories. As a long time international investor, he has been incredibly bullish throughout 2009 which is why I pulled up this story. I actually did a double take when he expressed caution; the reason being a flood of IPOs might finally sop up some of the massive caiptal central banks have injected into the global financial system. We'll see.
Trader Mark
http://www.fundmymutualfund.com/
- Emerging markets are attracting more money from initial public offerings than industrialized nations for the first time ever, a warning sign to Mark Mobius that the record rally in the shares may turn into a 20 percent decline.
- Faster economic growth may help China, India and Brazil produce the biggest increases in IPOs and almost double sales to $200 billion worldwide, according to Matthew Johnson, the New York-based head of the global-equities syndicate at Barclays Plc. Poland alone may offer more than $10 billion of state-owned companies, according to estimates by UniCredit SpA.
- “When you look at the size of some of these IPOs, they’re pretty massive,” Mobius, 73, who oversees $34 billion of developing-nation assets at Templeton Asset Management Ltd., “At the right price, the IPOs will be absorbed, but you’re going to have some hiccups. It’s too much supply coming out.”
- The combined value of China’s sales would be more than twice the $40 billion to $50 billion in the U.S.
- The 2009 sales exceeded industrialized nations by 160 percent, the first time developed countries attracted less money, annual Bloomberg data starting in 2000 show
- Companies in the MSCI Emerging Markets Index trade at the highest levels relative to earnings since 2000 after the gauge surged 75 percent and IPOs in developing economies raised $77 billion. The 767 companies in the MSCI Emerging Markets Index valued at an average 24.2 times earnings, data compiled by Bloomberg show.
- “There are some clouds on the horizon,” said Marc Faber, 63, who publishes the “Gloom Boom & Doom” newsletter. “For sure, the supply of equities will go up because the valuations are up,” he said in a phone interview from Da Nang, Vietnam.
Trader Mark
http://www.fundmymutualfund.com/
