Latin American Trading Call: What's Beaten Up and Over-beaten

It has been a rough start to the year for Latin American stocks after being the sweetheart of global emerging market investing over the last couple of years.

Valuations have become a little stretched, and the pullback driven by macro concerns on policy and commodity demand retreat have hit certain parts of the sectors harder. All countries have been hit, but the crowded trades (Brazil) and the politically challenged (Argentina) have in many cases underperformed. Steel and Copper names litter the list.

I have complied a trading list based on a screening I conducted for the largest market cap names that are ADR tradable, have underperformed and where there is either an oversold condition (based on RSI to chart) or valuation improvement to warrant a hard look.

Here is the list to pick over:

Resources: Cemex (CX), Gerdau (GGB), Petrobras (PBR), Ternium (TX), Southern Copper Corporation (PCU), Freeport-McMoran Copper & Gold Inc. (FCX), Grupo Simec (SIM)
Telco/Utilities: BBrasil Telecom (BTM), Tele Norte Leste Partricipacoes (TNE), Centrais Eletricas Brasileiras (EBR)
Banks: Itau Unibanco Holding (ITUB), Banco Bradesco (BBD) Banco Macro (BMA).

One Response to Latin American Trading Call: What's Beaten Up and Over-beaten

  1. You are the smartest guy on CNBC. I literally listen to your every word, sometimes backing up my DVR to make sure I got it, because sometimes you talk so fast. Clearly your brain clicks along at a million miles an hour… what I wouldn’t give to know the markets with the understanding you clearly have of how everything globally interacts. Thanks for being out there in these treacherous markets, Gerri

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