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Chart of the Week - The Forgotten Continent
This week: global equities, bonds, US Dollar, US economy, Silver, LatAm equities
This email gives you a look at what was in the latest Weekly Insights report
Chart of the Week - Latin American Equity Valuations
LatAm PE10 Valuations: For fans of valuation charts, this one will surely be fascinating — average PE10 ratio valuations across Latin American stock markets are currently near record lows.
As we’ve previously discussed, emerging market equity valuations in general have shifted toward the cheaper side, but the LatAm subset have actually reached outright cheap levels — close to record lows.
LatAm FX has also come under pressure this year, particularly in H2 when commodities saw weakness (and the FX also now look cheap at this point).
Interestingly, LatAm central banks were first to hike rate and arguably front-loaded a lot of their hiking, so they could also end up being first to pivot to easing.
So while it’s definitely not without risks, it is arguably worth a closer look as we move further through the global equity bear market and opportunities emerge.
Key Point: Latin American equities’ PE10 valuation ratios are near record lows.
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Topics covered in the latest Weekly Insights Report
Aside from the chart above, we looked at several other charts, and provided updates on some really important macro/asset allocation issues right now:
Discretionaries vs Staples: continuing to move in opposite directions.
US Treasuries: review of yields after significant moves last week.
US Dollar: how the key charts are moving now that *the* top is in.
US Economic Outlook: all the data point in one direction (recession).
Silver: sentiment is turning up from excess pessimism, new bulls?
LatAm Equities: why the forgotten continent is worth remembering.
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