Global Markets and Economic Update

FOREIGN STOCK MARKETS

Stock index trends in native currencies and in dollars adjusted for currency fluctuations. The dollar-adjusted returns are what U.S. investors would realize.

Last week Year to Date Market Native In dollars Native In dollars Argentina -2.1% -2.0% +37.2% +37.0% Australia +4.5 +5.1 +33.1 +30.1 Brazil +25.9 +16.6 +2381.4 +71.9 Britain -0.3 -0.9 +14.0 +11.4 Canada +2.3 +1.7 +17.1 +12.9 Chile -0.7 -0.4 +20.4 +11.8 France -1.3 -2.9 +20.7 +12.5 Germany +0.1 -1.4 +34.0 +28.1 Hong Kong +11.0 +11.0 +73.5 +73.8 Indonesia -0.3 0.0 +67.0 +64.3 Italy -1.4 -4.2 +38.4 +23.8 Japan -2.6 -2.9 +24.5 +43.0 Korea +2.2 +2.4 +12.7 +9.8 Malaysia +3.7 +3.2 +69.5 +73.0 New Zealand +4.5 +4.3 +51.2 +63.2 Singapore +0.8 -0.6 +33.4 +37.5 Spain -0.3 -1.5 +50.9 +27.9 Taiwan +0.4 +0.4 +20.8 +14.3 Thailand +16.9 +16.8 +55.7 +56.7 U.S. +0.9% +7.1%

Source: Morgan Stanley Capital International

MEXICAN STOCKS

* The market, closed Monday and Tuesday for a holiday, finished last Friday at 2,020.26 as measured by the Bolsa index--just under the peak of 2,029.06 set on Oct. 26. The market leaped 42.28 points on Friday, as investors counted votes in Congress and bet that the North American Free Trade Agreement will pass.

* While Mexican President Salinas is downplaying NAFTA’s importance, traders say little else but the pact’s expected passage is supporting the Bolsa. Quarterly corporate earnings reported by major Mexican firms last week were at the low end of expectations, hurt by the summer slowdown in Mexico’s economy.

Source: D.A. Campbell

SPOTLIGHT: CANADA

The economy is picking up steam after a lingering recession--blamed in part on austerity measures of the Progressive Conservative Party, which suffered a crushing defeat last week to the Liberal Party headed by Jean Chretien. But the growth is fueled largely by exports to the U.S. and could be stymied if the U.S. recovery falters.

Sources: Bank of America; World Information Services