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Some notable events during last week:
1) IPOX Global Indexes stable as selected Emerging Markets fall sharply: The IPOX Global Indexes tracked the major benchmarks last week, with the IPOX Global Composite Index gaining slightly versus the respective benchmarks. With the exception of the IPOX LatAm 20 Index, the relative performance was relatively even across the IPOX Global Indexes spectrum, with the IPOX U.S. Indexes slightly underperforming, while the IPOX Europe and the IPOX China slightly outperformed.
2) Finally - Putin and the BP saga spook investors in Russian stocks: The IPOX Global Indexes were unable to stay clear from the sharp drop in Russian stocks, after Putins comments initially pressured Mechel Steel Group (-33.77%) and the head of BP responsible for its Russian join venture left the country, alongside 250+ of BPs Russian employees, heavily influencing IPOX heavyweight OAO Rosneft Oil (-10.41%). In other individual stocks, as covered earlier, VM Ware (VMW), largest US IPO last year (with Fidelity recently increasing its holding) and once a USD 110bn behemoth, continued to fall, after the company’s earnings guidance did not meet expectations. A similar fate hit Chipotle Mexican Grill (CMG): The 2006 IPO closed at USD 66, well below the all time high of USD 155. Both companies share abnormal initial returns as a same initial trading characteristic, therefore making it ineligible for IPOX Global Indexes membership.
3) IPOX LatAm Indexes rise as Brazil and Latin American benchmarks plunge: The IPOX LatAm Indexes, including the IPOX LatAm 20 Index (IPXULATT) rose last week, outperforming the MSCI Latin America Index (MXLA) and Bovespa (IBOV) by between 510 and 600 (!!!) basis points. The sharp divergence in performance spreads on a week-by-week basis continues to underline the benefit of the IPOX Latin America Indexes as an asset allocation tool for liquid Latin America growth stocks.