What is interesting is the growing use of credit cards in emerging markets where cash was king.
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New York, NY (PRWEB) November 27, 2012
A leading financial e-letter issued by Lombardi Publishing Corporation, a 26-year-old consumer publisher that has served over one million customers in 141 countries, Investment Contrarians recently published an article by leading financial expert George Leong, reporting that in spite of weak third-quarter earnings results, emerging markets have been a bright spot in the stock market, experiencing significant increases in consumer spending.
In a recent Investment Contrarians article, Leong states that global networking giant Cisco Systems beat on revenues and earnings estimates in its 2013 fiscal first-quarter; with the Asia-Pacific and EMEA (Europe, the Middle East, and Africa) regions now accounting for 41% of the company’s total revenues. According to Leong, these results demonstrate the growing importance of the non-U.S. markets, particularly Asia, and the emerging markets to Cisco and other multinational companies. (Source: “Cisco Reports First Quarter Earnings,” The Network, November 13, 2012.)
As the article notes, recent results from global credit card provider MasterCard also point to an increase in consumer spending. With a presence in over 210 countries, MasterCard is a global barometer of consumer sentiment. The company said that third-quarter global purchase volume surged 12% on a local currency basis. (“MasterCard Incorporated Reports Third-Quarter 2012 Financial Results,” Yahoo! Finance via BusinessWire, October 31, 2012.) MasterCard President and CEO, Ajay Banga, said, “Additionally, emerging geographies and governments continue to provide great opportunities for growth.”
“What is interesting is the growing use of credit cards in emerging markets where cash was king,” states Leong, the Investment Contrarians expert. “MasterCard clearly sees new markets in these growth regions where the per capita income is rising, helping to drive consumer spending and economic growth. There is an excellent global opportunity for growth in the emerging markets due to rising income levels and consumer spending.”
Leong adds that China and India will be the explosive areas for consumer spending given that over one-third of the world’s population lives in these two countries and both are driving to improve standards. Equally important, according to Leong, will be consumer spending growth areas in Asia, including Hong Kong, Singapore, South Korea, and Taiwan; the wealth levels in these regions are extremely high.
As the Investment Contrarians expert reports, consumer spending is also on the rise in Latin America. The region’s gross domestic product (GDP) growth is estimated to slow to 3.7% this year, down from 4.5% in 2011, according to the International Monetary Fund (IMF). On the plus side, growth is expected to rally to 4.1% in 2013. The key player in Latin America is Brazil, which will spend heavily as it gets ready for the World Cup in 2014, followed by the Olympics in 2016.
Another emerging region that Leong notes will see strong consumer spending growth is Eastern Europe—namely Russia, the largest economy in Eastern Europe, and Poland, the second-largest economy in the region.
Leong concludes, for an investor to diversify their portfolio and add possible higher returns, believing it would be prudent to take a look at these emerging markets.
Founded in 1986, Lombardi Publishing Corporation, which has served over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more information on Lombardi Publishing Corporation, and to get its popular Investment Contrarians e-letter sent to you daily, visit http://www.investmentcontrarians.com, or visit http://www.lombardipublishing.com/customer-service.html.