Brazil Tops China as Emerging Market with Largest Market Cap
By
Paul Goodwin, Editor of
Cabot China & Emerging Markets ReportFrom Cabot Wealth Advisory 3/2/08
Sign up for free Cabot Wealth Advisory e-newsletterThe news is out: Brazil is now the largest emerging market in the world by market capitalization of its stocks, and Petrobras, the Brazilian oil giant, is the largest company in the emerging markets by market cap. Brazilian stocks now make up about 15% of the MSCI Global Emerging Markets Index, compared with China's 14%.
The South American giant has surpassed China, in part, because the Chinese stock market is in the middle of a pullback that has given its stocks a significant haircut. That's the way it is with emerging markets; they go up faster than developed markets and come down faster, too.
This news doesn't make a lot of difference to the way I will pick stocks for the Cabot China & Emerging Markets Report, or manage its portfolio. The most important thing will still be the stories, numbers and charts of the stocks themselves. Being blind to the momentum of countries has its advantages, especially when emerging markets stocks are acting skittish.
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