<a href=www.estrelladigital.es>Estrella Digital Primo González

La cruda realidad de la economía, tal y como están revelando los informes de los numerosos organismos internacionales que esta semana se han volcado en presentaciones y anticipos del inmediato futuro, parece no tener contentos a los expertos ni a los inversores ni en general a los agentes económicos. La guerra está, por lo que parece, vista para sentencia en Iraq y los gobiernos de los países más importantes, en especial los que tienen presencia activa, con y sin veto, en el Consejo de Seguridad de la ONU se aprestan para organizar el futuro de Iraq sin Sadam.

De momento, lo único que parece estar claro en el plano de las realidades es el proyecto americano de poner de nuevo en marcha la máquina de extracción de crudo en Iraq y hacerlo con la mayor brevedad posible. Las estimaciones que se hacen estos días señalan que el daño causado a las instalaciones petroleras por los saboteadores y por el estado de abandono en el que se encontraban a causa de la prohibición de exportar una buena parte de la producción es más que aceptable. Tanto que ya hay en perspectiva un programa de recuperación de las exportaciones petroleras del orden de los 800.000 barriles diarios a través del golfo Pérsico, es decir, de los yacimientos de la zona sur del país.

Una producción muy estimable que se tendría que complementar con la entrada en producción de los ricos yacimientos del norte, en donde el desenlace final de la batalla presenta todavía algunas incógnitas. No tanto porque el régimen de Sadam Husein vaya a mantenerse en esta zona sino porque el crudo de los yacimientos del norte del país entra en otro tipo de dinámica debido a la particular situación del pueblo kurdo y sus relaciones con Turquía y la salida al mar del crudo a través de territorio de terceros países. Pero, problemas y obstáculos políticos al margen, si la situación se normaliza, esta zona del país debería poner sobre el mercado un flujo de petróleo no inferior al millón de barriles diarios en un plazo razonable, quizás no superior a un mes.

Si estas condiciones se cumplen, y entra dentro de los planes de los aliados que se cumplan en términos bastante parecidos a los comentados, Iraq aparecerá en breve como un importante agente del mercado petrolero, en unos momentos en los que la oferta de crudo supera con cierta amplitud la demanda del mercado y en el que algunos países importantes, en especial Estados Unidos, están embarcados en una operación de reconstitución de sus reservas estratégicas. No resulta extraño, por todo ello, las prisas que les han entrado a los dirigentes de la OPEP a la hora de convocar reuniones de urgencia para adoptar medidas de control de las exportaciones.

La preferencia que en la situación actual va a tener Iraq, a la que la comunidad internacional, los aliados sobre todo y la ONU si llega a tener papel en ello, concederá todo tipo de ayudas para que el flujo de petróleo permita financiar una rápida reconstrucción del país, puede condicionar la armonía y la cohesión interna de la organización de exportadores. No hay que olvidar tampoco el hecho de que Venezuela, tras la crisis política de estos últimos meses, está volviendo de forma gradual a sus niveles de producción y exportación de crudo anteriores a las revueltas que colapsaron su producción hasta hace apenas un mes.

El precio del petróleo ha bajado escalones importantes en las últimas semanas. Se ha situado en el precio ideal que los analistas económicos siempre han considerado como neutral a la hora de influir en la evolución de las economías occidentales, es decir, entre los 24 y los 25 dólares por barril. Convencer a los países exportadores a que recorten sus cuotas de producción para hacerle un hueco al recién llegado y para permitir al mismo tiempo que el nivel de precios no se desplome es ahora la ardua tarea a la que se enfrenta la organización de exportadores. Dicho de otra forma, no parece improbable que el coste de la guerra de Iraq y de la reconstrucción del país vaya a estar muy lejos de la capacidad de sacrificio y entendimiento del mundo árabe exportador de petróleo. La guerra no va a salirle gratis a casi nadie, pero desde luego mucho menos a los productores del Golfo.

<a href=www.bnamericas.com>BNAMERICAS Report Type : Reports Published on: Monday, April 07, 2003 Provider : Capital Markets Argentina Author : Research Department Head Alejandro Quelch Email Author: aquelch@capitalmarkets.com.ar Language : English   Page Count : 10 Delivery Options Format PDF Price Free Download: getresearch (application/x-macbinary, 88 KB)

Argentina

Bonds rose amid speculation of a better economic scenario but election polls are far from showing a clear lead. The buyback of quasicurrencies was decreed and uses for BODEN 2012 have been regimented. Also, Q1 fiscal targets have been met, as expected.

US

Last week, market mood improved as the news flow from the war showed advances from coalition forces. The dollar regained ground by the end of the while economic data has proved highly discouraging. The labor market deteriorates and no upturn in business investment is clearly seen by now, so the concern over the possibility of a double dip might re-emerge as war fears ease.

Europe

The European Central Bank left its interest rate unchanged at 2.50% in its meeting, however it is estimated that there will be at least a 25 basis points reduction in the near future. In fact, futures indicate a reduction at the end of the first semester.

Mexico

Mexican markets followed US markets on the uphill as well. Fiscal outlook remains solid, while the election outlook now favours the PRI.

Brazil

Brazil continues to rally on optimism over the reform agenda, moderating inflation, an appreciating currency and firm demand for external bonds. Last week the amendment that paves the way for Central Bank independence was voted, and this week could see its final vote.

Venezuela

The government is considering a voluntary external debt swap, and a team will soon travel to the US to gather support from institutional investors. Also, the Supreme Court is to rule on currency controls in the coming weeks. 

BNamericas Research Partners You may be transferred to a BNamericas partner, who may require you to register with their service to complete your requested transaction.

If you have any questions related to this service or about our research partners, please contact us at (56-2) 232 0302 or research@BNamericas.com.

<a href=www.thestar.com>Toronto Star Sun Apr 6, 2003 | Updated at 12:42 PM Apr. 6, 2003. 12:44 PM DAVID OLIVE COLUMNIST

"We will not renounce our part in the mission of our race, trustee, under God, of the civilization of the world." —U.S. senator Albert Beveridge (R-Ind.) in 1900, in reference to America's justification for crushing a Filipino rebellion against the U.S. military government in Manila.

The rock throwers who took to the streets of Seattle in the late 1990s to curb the pace of globalization may yet realize their dream.

The crisis in diplomacy over the Iraq war has already thrown globalization into reverse gear. And the ultimate disintegration of the global economy, if it should come to that, will be traced to an unlikely ally of the anti-globalization movement.

George W. Bush's doctrine of pre-emptive strikes at "rogue nations" suspected of developing weapons of mass destruction and harbouring terrorists is more far-reaching in its consequences than even its detractors yet realize.

Logically, the projection of unfettered U.S. power around the globe in pursuit of the American president's national-security objectives will require that the world's lone superpower assume many roles in global governance now filled by post-World War II international bodies that the United States no longer trusts. It will force America to micro-manage the world economy and the activities of multinational corporations lest they abet real or perceived U.S. enemies.

"Boosters of corporate-led globalization should understand that their vision of a new world order is fundamentally incompatible with George W. Bush's," writes William Greider in the current issue of The Nation, a left-leaning U.S. journal not generally regarded as a hand-holder of capitalists. Greider's reasoning is that if the United States now proposes to strike pre-emptively at nations, it will show little hesitation in striking at companies or whole industries that don't readily fall in line with Bush's more robust definition of Pax Americana.

The Bush Doctrine of unprovoked intervention and crass, unilateral pursuit of national self-interest repudiates half a century of American-led global growth in free trade, free movement of labour, more rapid exchange of intellectual property and promotion of "transnational" corporations.

In its first year alone, the Bush administration withdrew from five international treaties, and repudiated Clinton-era diplomatic initiatives spanning the globe from North Korea to the Middle East.

And that was before the recent showdown at the United Nations over Iraq, in which the United States undermined the authority of an organization that co-ordinates everything from global humanitarian aid and technical standards for industry to agricultural management and postal conventions.

Until now, the ugly face of globalization has been sweatshops in the developing world, capricious Western bankers dictating harsh economic policies to disadvantaged nations, and the dumping of under-priced Western agricultural goods in Third World markets where local producers are forced off their land.

Now add to that a spectre that threatens global business executives.

In its campaign to neutralize real and perceived threats to its security, the United States will at least to some degree have to abandon its free-market instincts.

At a minimum, Bush will likely see the need to more strictly police the international trade in "defence-sensitive" materials, applying new regulatory controls on the multinational corporations from which Iraq, North Korea, Pakistan and India buy their weapons and the seemingly innocent "dual-use" materials that can be converted into weapons.

The definition of "defence-sensitive" is open-ended. The notorious aluminum tubes purchased by Saddam Hussein were useful both for irrigation projects and as sheathes for nuclear-weapon projectiles.

Defence-sensitive could now embrace everything from crop dusters to fertilizer for making Timothy McVeigh-type truck bombs to sophisticated video-game components that could be "weaponized" as a triggering device for explosives.

To whom will General Motors Corp. now be permitted to sell Humvees, and with what restrictions on their use? Given the resilience under U.S. bombing of Iraq's fibre-optics communications network, essential to Saddam's command-and-control system and supplied in part by the likes of Nortel Networks Corp., how soon before multinationals such as Nortel, JDS Uniphase Corp., Corning Inc. and Sweden's L.M. Ericsson Co. are made to present their order books to Washington for approval?

Just as the international traffic in technology will need to be regulated by the United States, so too will the global flow of money. Having already tried to freeze Iraqi financial assets worldwide, the Bush administration will be tempted to busy itself with strategic interventions in global money markets in efforts to starve other outlaw nations of financing.

Victims of the collateral damage from implementation of the Bush Doctrine will include multinational corporations long accustomed to selling what they want to whomever they want, with minimal or no supervision from the United States or any other government. French oil giant Total SA will now know that doing business in Libya risks French telecom giant Alcatel SA losing contracts with U.S. phone companies. And banks, brokerages, pension funds and other financial intermediaries around the world will be looking over their shoulders as Uncle Sam vets every transaction.

An alarmist scenario? Perhaps. But the Bush Doctrine has plenty of capitalists worried about the global designs of the supposed free-enterpriser in the White House.

"American imperialism is, by definition, a retreat away from global capitalism," says Paul McCalley, a managing director at California-based PIMCO, the world's biggest bond investor. "It's a retreat from the invisible hand of markets in favour of a more dominant role for the visible fist of governments."

As in postwar Iraq, the rebuilding of future targets of "regime change" might also be undertaken exclusively or mostly by U.S. firms in projects for which the U.S. taxpayer alone picks up the tab. It could scarcely be otherwise if much of the world balks, as it did in the Iraq conflict, at how the United States now defines both its national security interests and how to manage them, without recourse to world opinion.

Currently, the European Union and Japan cover most of the cost for their own and UN-administered humanitarian efforts to stabilize trouble spots like Afghanistan, Cambodia, Mozambique and Kosovo. With the precedent it has set with Iraq, the United States risks shouldering most of the burden of nation-rebuilding.

"Were Washington to move to an entirely ad hoc approach," forsaking traditional international bodies in dealing with failed regimes, "why would the rest of the world agree to clean up its messes?" asks Newsweek in a recent cover story on "America: The Arrogant Empire."

Sixteen years ago, William Hyland, a national security official in the Nixon and Ford administrations and editor of Foreign Affairs, warned that "isolationism is the Dracula of American foreign policy." Under Bush, the U.S. appears to be reverting to a less benign version of the isolationism that helped cripple the world economy in the 1930s.

The Wall Street Journal, champion both of Bush's Iraqi adventure and unfettered capitalism, recently acknowledged the constraints on capitalism inherent to the go-it-alone Bush Doctrine: "There is a risk that the bitterness so apparent today will linger; that it will be harder to pursue trans-Atlantic business deals; that already tense talks toward freer trade in agriculture and services will be prolonged for years ... and that the focus on strengthening and modernizing post-World War II institutions — the International Monetary Fund and all the rest — will be dissipated."

If Bush means to revolutionize America's place in the world, the United States must brace for the inevitable backlash.

After the terrorist attacks of Sept. 11, 2001, the Bush administration reneged on a high-profile promise to Mexico, the country Bush himself identified as America's best friend. In a move that undermined Mexican president Vincente Fox's popularity at home, the United States abandoned a plan to legalize the status of millions of undocumented Mexicans working in the United States. (The White House was later surprised when Mexico couldn't bring itself to support it on Iraq at the UN, despite enormous U.S. pressure.)

As anti-globalization activist Naomi Klein observed in the Globe and Mail last week, "Rather than Canadianizing the Mexican border, the United States has opted to Mexicanize the Canadian border," alienating America's other neighbour in the bargain with intrusive new inspections of Canadian citizens born in any of the countries on the White House list of rogue nations.

The predictable result is an anti-U.S. backlash in both countries. "Most officials in Latin American countries today are not anti-American types," Jorge Castaneda, former Mexican foreign minister, told Newsweek recently. "But we find it extremely irritating to be treated with utter contempt."

Fareed Zakaria, the correspondent who interviewed Casteneda, wrote that, "Having traveled around the world and met with senior government officials in dozens of countries over the past year, I can report that with the exception of Britain and Israel, every country the Bush administration has dealt with feels humiliated by it."

The grim harvest of that humiliation has already begun to appear, notably in Europe, where nations that took opposing sides on the Iraq war are quickly patching up their differences.

With a combined population that exceeds the United States, the European countries are attracted as never before to the model of close collaboration in world governance that Bush has rejected — and largely because Bush has rejected it. Some U.S. foreign policy experts thought Polish and Czech support for the Iraq war would drive a wedge between Eastern Europe and the anti-war alliance of France and Germany, the latter famously dismissed by U.S. defence secretary Donald Rumsfeld as "the old Europe."

Many Americans also expected pro-war Britain to turn its back on the continent, seeking a more substantial bond with the United States, pro-war Australia and other outposts of the so-called "Anglosphere." (The hawkish promoters of this new, racism-tinged concept seldom mention the neutrality of Canada and New Zealand over Iraq.)

Yet two weeks ago, British prime minister and war hawk Tony Blair was touring European capitals to renew his commitment to a Britain more thoroughly engaged in joint European decision-making not only on economic policy but the even more challenging task of developing a co-ordinated EU defence and foreign policy.

The East Europeans who so greatly value membership in an expanding EU are in no mood to rebuke the EU economic powerhouses of Germany and France. And in seeking the prosperity and national security continental fraternity, the smaller countries want a voice in Europe's affairs — especially now that the United Nations, traditional venue for small-country influence, has been so assiduously undermined by the United States.

And yet, a future project for a Europe unified as never before might be a revitalization of the UN as a more effective response to U.S. global hegemony. A measure of the virulence of current U.S. antipathy is that the Iraq crisis ended a period of fractious relations between France and Germany.

Whether the French and the others acted on principle over Iraq or in defence of their long-standing financial interests in the Arab world is beside the point. The anti-war Europeans, principally France, Germany and Russia, proved themselves capable not only of forging an anti-war coalition among themselves, but of drawing an Asian power, China, the world's fastest-growing major economy, into their sphere of influence as well.

"If Bush is to act as global emperor, can the UN survive as a parliament which holds him to account?" London's Guardian asked recently. "Now that would be a common European foreign policy worth having."

<a href=news.independent.co.uk>/news.independent.co.uk By Jeremy Warner 04 April 2003

Both literally and metaphorically, the world economy is being weighed low by an outbreak of severe acute respiratory syndrome (Sars). Our own small island, where the disease has yet to reach pandemic proportions, first. Manufacturing remains deep in the doldrums, construction is slowing, and now the once buoyant services sector seems to be shrinking too. Don't be fooled by yesterday's Nationwide survey, which showed continued strong growth in house prices, or Bank of England figures showing that equity withdrawal reached near record levels in the final quarter of last year.

The story told by these numbers is a backward looking one which saysvery little about what's happening to demand and confidence right now. The Bank of England tacitly acknowledged that a tipping point had been reached in the economy last February, when it unexpectedly cut interest rates. Things have deteriorated a lot further since, and were it not for rising public sector expenditure, I think we could be pretty sure that the economy as a whole would be in recession. Certainly the private sector is contracting right now.

It's unclear how much of the blame for this can be attributed to Iraq. The continued after effects of 11 September, the end of the investment bubble, and the subsequent 50 per cent collapse in equity values are equally potent factors. To these must now be added a fifth, Sars, which has already prompted a collapse in international air travel and the cancellation of conferences and events across the world. A pandemic was about the last thing the airlines needed on top of everything else, but they've got it.

Throughout large parts of Asia, the effect on economic activity is already devastating. Meanwhile, Europe continues to labour under the sickness of older diseases – a gradual hardening of the arteries for which it seems unprepared to take the cure. The European Central Bank could have cut interest rates yesterday, which may not have done a lot of good, but it couldn't have done much harm either. As usual, the decision was ducked. The best thing to do in current circumstances is to remain calm and confident, said the ECB president, Wim Duisenberg. Strangely, hardly anyone seems to agree with him.

As for the US, the declining dollar tells you all you need to know about what markets think of short to medium-term economic prospects in the land of the free.

That the Chancellor will cut his growth forecasts in next week's Budget is already certain. The question is by how much? Anything less than 1 percentage point for this year and next, reducing the range to 1.5 per cent to 2 per cent for this year and to 2 per cent to 2.5 per cent next, would be regarded as unrealistic. That leaves the Chancellor with a thumping great revenue shortfall to make good, either by taxing us more or by borrowing more from the capital markets.

In my view the economy is already at tax saturation point, in the sense that any further increase in the tax burden is likely to prove counter productive by stifling activity and spending and thereby reducing the overall tax take. Under Government plans, the tax burden is already due to rise from 36 per cent of GDP now to 38.6 per cent by 2007/8. It couldn't sensibly rise further without threatening the tax base as a whole.

We'll learn in less than a week whether the Chancellor shares that view.

In the meantime, there is but one ray of light amid all the gloom. The stock market is beginning to look through the fog of war to sunnier climes beyond. I'm more and more convinced the stock market has seen the bottom, even if the real economy, which tends to trail the markets by a year or more, has not. A serious setback in the war would sink that prediction, which is why caution remains the order of the day, but then only 3.5 per cent of those that develop Sars will die of it. Most of us will survive and, God willing, eventually prosper again.

BT price cuts

First British Telecom cuts the price of telephone calls. Now it's cutting the price of broadband. Well, that's if you count a £2 a month reduction in the wholesale price of ADSL as much of a cut. Rival broadband service providers say it's not worth a fig once you take into account that BT last week doubled the activation charge back to the old rate of £50, and you can see their point.

BT has based its whole growth strategy around the hunt for broadband customers and although it seems to be on target to meet its aim of 1 million ADSL connections by this summer, the marketing drive is plainly not delivering the planned for rise in top line revenue growth. As fast as volumes rise, BT is being forcing to cut prices, both in traditional voice telephony, where it faces increasingly intense competition from the new breed of carrier pre-select operators, and in broadband.

I've long believed that the best way forward for BT is to break itself up further by formally separating the telecom networks, which would sell their services entirely as a wholesale operation to other telcos, from its customer facing retail business.

The retail operation has already moved to exploit its customer base by offering other services and products besides telecommunications, but the fact that it is part of an integrated telco has hampered these efforts and prevented it from acting as aggressively and effectively in alternative utility markets as Centrica and others. Likewise, the wholesale operation is compromised in its broadband offering by the fact that the company's retail arm wants to keep as many new ADSL connections to itself as it can.

Ben Verwaayen, BT's chief executive, has committed himself to continued integration, but he must sometimes wonder whether a better break-up of BT than the one it undertook – the demerger of mmO2 – might have been to keep the mobile and retail interests together but demerge the wholesale operation. It's too late now. Or is it? mmO2, which surely offers better growth prospects than chasing broadband, could be bought for less than £5bn.

Corus bail-out?

How the mighty are fallen. In recent weeks, Sir Brian Moffat, chairman of Corus, the Anglo-Dutch steel maker, has been talking to both Lakshmi Mittal and Benjamin Steinbruch about possible combinations. The former is a less than transparent steel tycoon who nobody outside the industry had ever heard of until he donated money to the Labour Party. The latter is chairman of CSN, the Brazilian company Corus was last year trying to merge with.

The City hated the deal from the moment it was announced, largely because it couldn't stomach the idea of what Luiz Inacio Lula da Silva might do to the Brazilian economy once he became president. As it turns out, Lula seems more cuddly teddy bear than a workers' revolutionary, and if Mr Steinbruch could be prevailed upon to agree the same terms again, the City would bite his hand off to take them. Mr Steinbruch is not so stupid, and today, he would be the dominant partner in any merger, not Corus.

None the less, Sir Brian is right to be talking. The best that any new chief executive of Corus can look forward to is that of managed decline as things stand. If any value at all is to be salvaged from the wreckage of Europe's declining steel industry, Corus must find partners in the developing world, which one day, possibly quite soon will be producing all the world's steel requirements.

The Mittal approach to the remaining British and Dutch steel interests would undoubtedly be a hatchet job, reducing the company to a more specialist core. Sir Brian might reasonably conclude he could do that himself. CSN offers the more appealing route, but it may no longer be a bridge that's open.

jeremy.warner@independent.co.uk

Thursday April 3, 11:05 PM (This article was originally published Wednesday) By Charles Roth Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--Notwithstanding the way the war in Iraq has been whipsawing global financial markets recently, emerging market assets appear well positioned to ultimately ride the volatility higher in the months ahead.

Emerging market fund managers and strategists say cheap stocks and high-yielding bonds, coupled with solid economic growth prospects, all bolster the case for the asset class.

"If we get some form of (Iraq) resolution over the next couple months, then we will see a huge rally in all markets," said Allan Conway, head of global emerging markets fixed-income and equities at WestAM in London.

After a great run last year and so far this year, emerging market bonds still remain attractive. But the asset class's equities look set to offer the wildest ride, with the war and its aftermath driving the swings.

Once U.S. forces take Baghdad, from which they are now within 30 miles, according to the Pentagon, stocks are expected to soar.

"Then the question will be how sustainable is the rally? For that we'll have to look at the global economy," Conway said, adding that indicators point to weakness in the U.S., the European Union and Japan.

While emerging market stocks aren't likely to fly as high as developed market equities, they won't give as much back, he said, explaining that "valuations are extremely attractive" compared to the fair value or still-rich levels at which much of Wall Street still trades.

Tim Love, emerging market strategist at Deutsche Bank in London, agreed. "We're very bullish on a relative basis as they (emerging market stocks) enter their fifth year outperforming" the Morgan Stanley Capital International's All Country World Index, he said.

In addition to lower volatility, emerging market stocks "still have extreme support from valuations...indicative of the positive upside yet to go in the asset class," he added.

Brad Durham, a managing director at Massachusetts-based Emergingportfolio.com Fund Research, which tracks fund flows, pointed to data indicating that the forecast average emerging markets 2003 price-to-earnings ratio is 8.3. That's markedly cheaper than the double digit ratios at which most of Wall Street's stocks trade.

Even if U.S. economic growth accelerates in the second half, as anticipated, faster growth in emerging markets should provide a more solid foundation for appreciation in their asset prices.

WestAm's Conway, whose fund manages $750 million in fixed-income and equity investments across emerging markets, said most emerging market economies will expand between 3.5% to 6% this year. The World Bank expects developing countries to grow 4% in 2003, up from 3.1% in 2002. The range clearly outstrips the consensus 2.6% U.S. growth forecast, as well as the World Bank's 2.3% global growth projection for 2003.

A Wall Street-based trader of American Depositary Receipts from Asia said a number of Asian stocks are poised to rise on the back of several factors: robust growth in places such as China, India and Thailand; budget surpluses; improved corporate governance; hefty international reserves; falling dollar-denominated debt levels; and a willingness of Asian monetary and fiscal authorities to employ counter-cyclical measures to ramp up economic growth. At the same time, inflationary pressures remain benign.

One possible damper on growth, particularly in Hong Kong, Vietnam, Singapore and ultimately perhaps even China may be the recent outbreak of severe acute respiratory syndrome, or SARS, a highly contagious, little understood and potentially fatal illness.

Overall, Love said Deutsche Bank finds the Asia story compelling, and recommends adding weight in Asian equities.

WestAm's Conway, though, is less bullish on Asia, with an overweight only in Thailand, which is so far this year the only Asian equity market to post a gain in dollar terms - rising 5.5% on the MSCI index.

Outside Asia, Conway's overweight equity positions include Brazil, Chile and Russia.

Brazil has indeed turned into a popular play thanks to dirt-cheap valuations, its large market and the view that leftist President Luiz Inacio Lula da Silva, who took the helm at the beginning of the year, is sticking to orthodox economic policies.

"There's lots of positive news out of Brazil," said Tim Ramsey, an emerging market strategist at Bear Stearns in New York. "It should outperform in a resolution of the war in line with U.S. objectives."

Ramsey is recommending the South American giant's industrial exporters and sectors in which the government has a "lighter regulatory touch" such as the wireless telecommunications sector.

Views are more mixed, though, on Mexico and Russia, two other emerging market giants.

Conway is underweight Mexico, while Love likes the outlook for the country.

Love points out that despite its recent strengthening, Mexico's currency is still undervalued, which should help its exporters and producers for the domestic market. And market capitalization is less than 20% of gross domestic product, compared to 70% at its peak, he said.

Others, such as Bear Stearns' Ramsey, note that while Mexican stocks may be cheap historically, they don't have many drivers for growth, with structural reform initiatives stalled by divided legislative and executive branches, and likely continued political infighting even after July mid-term elections.

And without faster growth in the U.S., which absorbs more than 80% of Mexican exports, the country's stocks, which trade at a 2003 forward-looking P/E of 11.2, or more than double Brazil's forecast P/E this year, may not see as much upside as other emerging market stocks.

Russian equities, despite giant gains last year, are still attractively valued. But like the country's bonds, performance hinges predominantly on the price of oil. Love is neutral Russian stocks, while Bear Stearns' Ramsey is "very wary" in a "climate in which oil prices are falling."

As U.S. forces advance on Baghdad and oil fields in Iraq are increasingly secured, oil prices have tumbled to nearly $28 a barrel for May delivery from a high of almost $40 a barrel in the prelude to the war.

Falling oil prices could also spell trouble for sovereign credits such as Venezuela, Colombia, Ecuador and Nigeria, and don't much help Mexico, which sources about a third of its public income from oil and related taxes.

But lower energy costs, in addition to facilitating growth in the U.S. and Europe, will also help oil importers such as Brazil, Chile, Turkey and Northeast Asia. For these countries, cheaper oil may ease inflationary pressures, and could even prompt monetary authorities to lower interest rates, which would make corporate borrowing and debt servicing easier. That, in turn, should help stocks.

If it appears that emerging market stocks are on the whole poised to gain near term, the asset class's bonds will likely still garner plenty of investor attention.

After gaining 14% last year, and 8.4% so far this year, the spread on the J.P. Morgan EMBI Plus, at about 650 basis points over U.S. Treasurys, may not contract much more near term. But, WestAm's Conway said, with yields running around 10% compared to U.S. Treasurys, "they're pretty attractive."

And spread contraction is still probable in Brazil, Ecuador, Nigeria and Argentina, he added.

-By Charles Roth, Dow Jones Newswires; 201 938 2226; charles.roth@dowjones.com