Weaker Demand
The gauge of lenders including Brussels-based Dexia SA and UniCredit SpA of Milan is beating the Stoxx 600 Basic Resource Index by 13 percentage points. Mining shares such as Zug, Switzerland-based Xstrata Plc sank this year on speculation demand from China will weaken as interest rates rise.
South Korea's Kospi Index, dominated by exporters including Seoul-based LG Electronics Inc., has beaten India's Bombay Stock Exchange Sensitive Index by 13 percentage points in 2011, after underperforming by 30 percentage points the previous two years.
South Korean trade amounts to about 97% of GDP, double the ratio of 46% in India, according to the World Trade Organization's website. The Kospi is valued at 10 times estimated 2011 earnings versus 17 for the so-called Sensex.
Hindustan Unilever trades for 22 times net assets, compared with 2.9 for the 188-company MSCI All-Country World Index Consumer Staples measure, even after the stock slid 12% this year. The Mumbai-based company accounted for about 1.5% of the Oppenheimer Developing Markets Fund at the end of 2010, according to OppenheimerFunds Inc.'s website.
'Year of Catch-Up'
Cisco, which generated more than 74% of fiscal 2010 revenue in the U.S. and Europe, trades for 15.7 times reported earnings, 61% less than the average since 1991 and 9% cheaper than technology stocks in MSCI's global gauge, data compiled by Bloomberg show. The Legg Mason Capital Management Value Trust held 5 million shares as of Dec. 31, or 2.6% of the fund's assets, according to its website.
Cisco shares have rallied 6.9% this year after retreating 16% in 2010.
"We see 2011 as being more the year of the developed markets," Lothar Mentel, who oversees about $3.2 billion as the London-based chief investment officer at Octopus Investments Ltd., said in a Jan. 31 interview with Bloomberg Television. "This year is going to be the year of the catch-up."