Growing Cental European Media.

The only one Czech blue chip company which is also traded on US stock markets continues with definite bull trend. If you look at 6 years charts share price goes just sharply up.
This year Central European Media (CETV) gained 40%. The second best performing company among Czech blue chip cap. Shares were rapidly rising especially at the beginning of the year, Ukrainian concession was over but situation was resolved promptly. Plus very good earnings results and introduction of new investor (APAX funds). Last but not least appreciation of Central and Eastern European currencies helps to get better consolidated earnings reports in USD.

CEE emerging stock markets.

Shortly before end of the year Central and Eastern stock markets brought positive value on YTD basis. The best performing is Czech stock market with 16,7% and eventually over take major Polish stock market (12,7%). Czech index PX50 was more stable during recent turmoils than Polish WIG20. Stock exchange in Budapest is with 8,3% and Austrian stock market, which was booming in last couple of years, is ending almost unchanged with 1,5%.

CPI grew sharply more than market expected.

Consumer price index in Czech Republic increased by 5% in November. Market expected 4,5%. Mainly lifted by food inflation. For beginning of 2008 expectations are bit higher now (CPI 6%). Recently Czech National Bank - CNB- increased main interest rate benchmark to 3,5%. With last released CPI data we are again out of inflation targets followed by CNB. Inflation target is 3% with range +/- 1%. On the other side Czech currency Koruna is at strongest level against EUR, USD and therefore any other interest rate hike could hit dramatically Czech export.

FED meeting - next rate cut?

Tomorrow is next FOMC meeting and widely expected interest rate decision. Last couple of days shares have rebounded after sell off triggered by credit markets turmoil.

Last FED meeting cut was not so optimistic as accompanying speech didn't predict further rates decrease. But since that many things have happened. Crude oil pull back from record high, credit market fear, weak housing market and consumer spending. If you look at the chart, Fed fund rate (4,5%) is tightly "catching on" long term US bond, 10 year treasury note (^TNX). Latest market price is 4,15%.

My personal expectation is that FED will cut by 25 basis points.

Business Week. FED decision.

Monday
Economic: Pending Home Sales
Earnings: Imperial Sugar (IPSU), FuelCell (FCEL), SAIC (SAI), NCI (NCS)

Tuesday
Economic: Wholesale Inventories (.5%), FOMC Decision
Earnings: Kroger (KR), ABM (ABM), Cooper (COO)

Wednesday
Economic: Import / Export, Weekly Crude, Treasury (-$75.0B)
Earnings: Martek (MATK), CKE Restaurants (CKR), ADC Tele (ADCT)

Thursday
Economic: Retail Sales / ex Auto (.5%, .6%), PPI & Core (1.5%, .2%), Biz Inv (.3%)
Earnings: CDC China (CHINA), Ciena (CIEN), Costco (COST), Lehman (LEH), Leap Wireless (LEAP), Verifone (PAY)

Friday
Economic: CPI & Core (.6%, .2%), Ind Prod (.1%), Cap Util (81.7%)
Earnings: N/A

Dividend stocks. Another way to protect your portfolio.

Lately I've been publishing ways how to cover you portfolio in days of uncertainty. Currently I am searching for high quality dividend stocks. Among big caps top payers are usually banks and financials like Bank of America (BAC), Wachovia (WB) or Citigroup (C) with dividend yield around 6.
I've searched caps with market capitalization at least 5B and P/E below 15 and the winner is Magyar Telekom (MTA) with dividend yield 14. Also I rather prefer telco before financials nowadays. European telecommunication sector is one of my favourite. All good started with better than expected earnings results for France Telecom (FTA.PA). I still keep long position in Deutsche Telekom (DTE.DE). Both are traded at 52 weeks high.

Fundamental analysis failed.

There is a one specialty ETF from issuer Wisdomtree with ticker EZY. The fund comprise large value caps with low P/E valuation. As you can see on picture it is not even following performance of S&P500 (which has the worst YTD performance among major US broad market indices). How so?
The point is that before subprime lender issue one of groups with lowest P/E ratio were financials. Banks and brokerages were traded at 10-12 times yearly earning per share. And therefore major holdings in ETF are names like Citigroup (C), JP Morgan Chase (JPM) or Bank of America (BAC). Those pulled EZY so deeply down.

ETF screener for international investing.

Today I would like to provide you link which I usually use for searching international ETF or sector/industry focused. In search ETF search engine you mark in which country exposure you are interested in. Results bring you all exchange traded funds with some holdings from your country. The same you can apply for sector screening or funds under laying fixed income investments.

Except of ETF you can search closed end funds (CEF) as well. Here search selection is more detailed as you can choose fixed income corporate, government or some specialty. Also with options like taxable, municipal or leveraged fund.

I am giving you link to "Stock screener" section as usual.

Business Week. ISM.

Monday
Economic: ISM (50.5), Auto & Truck (5.2M, 7.1M)
Earnings: Cost Plus (CPWM)

Tuesday
Economic: NA
Earnings: AutoZone (AZO), Shaw Group (SGR), AeroVironment (AVAV), Chico’s (CHS), Guess (GES), Quanex (NX), Wind River (WIND)

Wednesday
Economic: Productivity (5.5%), Factory Orders (.4%), ISM Services (55), Weekly Crude
Earnings: DSW (DSW), Comtech (CMTL), Greif Bros (GEF)

Thursday
Economic: Weekly Claims (335K)
Earnings: Analogic (ALOG), CDC Corp (CHINA), Methode (MEI), Toll Bros (TOL), UTI World (UTIW), Nat Semi (NSM), Optium (OPTM), Smith & Wesson (SWHC), Verifone (PAY), Synopsys (SNPS)

Friday
Economic: Jobs Data (75K, 4.8%, .3%), Michigan (75.5), Consumer Credit (5.0B)
Earnings: Kellwood (KWD)

CEE emerging markets.

Outlook for Central and Eastern European countries remains positive. Europe is still Nr.1 for US export. In terms of corporate taxes in New Europe it is about 20% vs. 38% in Western Europe (Germany, France, Italy etc.). Also currency appreciation is helping to lift your CEE investments higher. Local currencies are the strongest against both, USD and EUR.

Russia - With boosting economy (7% growth per year) is attracting many investors and is currently the biggest investment country in CEE region. Mainly energy, materials and telecommunications are shaping RTS index.

Poland - By 2-3% exceeding average GDP growth in EU-15. This year economic growth 6,2% is expected.

Hungary - New law protecting local companies against enemy takeover spreads negative feelings all over.

Czech Republic - Till 2010 corporate taxes will be decreased from 24% to 19%. The leader is energy sector after announcement that energy prices will be up by 9% in year 2008.