Happy Bastille Day! Pres. Trump is in Paris as the representative of the country which 100 years ago sent troops to France under the slogan: “Lafayette, nous voilà” or Lafayette, here we are! He managed two faux pas already, first complimenting Mme Macron (who is closer in age to Trump than she is to her husband, the French president) for looking so good, which translates as “être bien preservée” not considered a compliment to a Frenchwoman.

Then he stumbled some more in his tweet about “their failed Obamacare replacement approved” which put the adjective failed in the wrong place.

Which brings me back to gold. I am not keen on buying gold to prepare for a stock market crash or a rise in inflation risk because these cannot be predicted based on past history. In economics, history tends not to repeat because everyone is looking at the same patterns.

My call is for investors to hold gold as a hedge against likely geo-political upheaval. Between the risks to his family members over the Russian involvement in his election win and potential loss of wealth, between his visible weight gain and distraction and loss of focus, there are real risks of something bringing the Trump Administration to a premature close. Having lived through Watergate I want an exit strategy.

As the operator of a blog on foreign securities I would normally expect that to offset US risks for my readers. But in case you haven't noticed, there are unexpected political risks in other countries as well. I am not talking about Venezuela or Zimbabwe or other long-term basket case economies. I am referring to normal boltholes for US investors in the Americas, Europe, and the Far East: Mexico, Canada, Brazil, Britain, Germany, Hungary, Poland, Italy, Israel, India, Hong Kong, South Korea, Taiwan, Malaysia, South Africa, The Philippines, all facing political crisis whether generated internally or in reaction to missteps by the US, the Fed, the European Union, North Korea, whatever.

More news from several of the countries listed above including a quarterly report. Plus two stock recommendations.

Technology

*Infosys (INFY) reported modest gains in its Q1 last week and the stock fell modestly as well but on immodest volumes. Its profits rose 1.4% to 34.83 bn rupees ($540 mn), beating the analyst forecast of INR 34.44 bn gathered by Thomson-Reuters. Revenues also beat at INR 170.78 bn, up 1.8% y/o/y., CEO Vishal Sikka credited new signups and said he was “very happy with our performance.” INFY repeated its forecast that revenues in the 17-18 FY to next March will rise 6.5%-8.5% and 7.1-9.1% in US$s, revealing dependence on H1-B visas to bring skilled Indians to work in the USA, which is going to be limited by Pres. Trump. To overcome the challenge it is aiming to provide more advanced services to clients, like cloud computing and big data analytics—but so its everyone else. Its 2.5% yield is safe but its growth is definitely slowing. Consensus for the stock, according to Thomson-Reuters, is a low hold with the 12-mo average target price $15, 4% under its current level. So we exited.

*Naspers again made a new 52 wk high in London (and Johannesburg) last week. Apart from exiting South Africa, it rose because Yandex.taxi, part of its Russian Internet investment, managed to force Uber to agree to share with it control of their new joint venture for car and informal taxi booking. Having tried to undercut Yandex which owns the Russian map app, Uber folded in part because its drivers could only be paid in cash, not credit cards, after it lost nearly $1 bn. Yandex is Russia's leading search engine, well ahead of Google, and started the car share business two years before Uber entered the Russian market. The new joint venture will operate in 127 cities in Armenia, Azerbaijan, Belarus, Georgia, and Kazakhstan. Yandex owns 59.3% of the new venture; drivers own 4.1% poorer Uber 36.6%. Yandex which is separately listed rose 16% last week; we sold YNDX too soon.

*SAP (SAP) of Germany, sold, is investigating charges that it paid bribes to members of the South African Gupta family to secure business from state-sector port operator Transnet. The Guptas are under scrutiny as bag men for Jakob Zuma and his fellow officials.

*UK metronics firm Renishaw rose 3.9% last week, RNSHY trades rarely, but well.

Drugs and Healthcare

*Barron's suggests a back-passage to India, using Taro, an Israeli dermatology drug firm owned by Sun Pharma of India, for which it accounts for nearly half of profits. It quoted Sunil Asnani who manages Matthews Asia Indian portfolio out of San Francisco which has 3.5% of its assets the NYSE-listed firm. While TARO is barely covered by analysts and therefore cheap, Sun is expensive but beloved in Bombay. Stripped of Taro's contribution it is trading at about 75x earnings. Note that Taro is expensive since each share costs over $112.62. Israeli markets are closed Fridays and drug stocks were bullish on the Trumpcare initiative.

*To offset the risk, I advise also buying a truly cheap Israeli stock, BioLineRx, which was at 91.6 cents last week on Wall Street, despite its BL-8040 being tested by Roche sub Genentech in combination with atezolizumab (its anti-PDL-1 cencer immunotherapy agent) in metastatic pancreas ductal cancer. BL-8040 is a CXCR4 antoagnist which mobilizes immune cells to kill tumors. Thomson-Reuters upped BLRX from sell to hold. The stock gained 4.6% last week but if this pans out it will go up more, although of course it is losing money in the manner of Israeli startups.

*The securities litigation firm Brower Piven is looking for someone who lost over $100,000 in May to be lead plaintiff in a case against Mazor Robotics. MZOR's shares fell after it revealed that it was under investigation by the Israeli Securities Agency, their SEC, only on June 8. It visited MZOR's offices and questioned some of its officers, but MZOR has not been charged with any offense, so far, and may not have violated Israeli law. I did not lose that much money. If you did contact Brower or other litigation firms targeting Mazor,. Meanwhile Mazor CEO Ori Hadomi pre-announced its Q2 revenues with were up 85% y/y. MZOR was up 2% last week, despite the lawyers.

*If Pascal Soriot jumps ship to Teva (TEVA) maybe the Israel generics firm will buy his current employer, whose share is sinking fast, Astra-Zeneca.

*The attempt by Compugen's (CGEN) former IR and another investor to land seats on its board garnered on 17% of proxies and was defeated. CGEN is another Israeli drug startup.

Finance

*Standard Life was upped to a buy from a hold by HSBC analysts, with a target price of GBX 460, up 15%. This may reflect that problems Manulife in Canada is facing with its own US fund management group, John Hancock, which it is planning to sell. SLFPY is merging with Aberdeen Asset Management which runs several of our closed-end fund faves.

*UK challenger bank Virgin Money rose 7.5% perhaps because animator Sir Richard Branson opened the exhibit of the Kodiak Queen, a restored relic of the attack on Pearl Harbor off Virgin Gorda, B.V.I. This is not his private island which is called Moskito where he hosted ex-Pres. Barack and Michelle Obama in Feb.

*Bank of Nova Scotia under a preliminary prospectus dated Tuesday will issue US$1.1 bn of fixed rate notes at 2.15% coming due in 2020 and $400 mn of floating rate notes also due then, with its US arm, Merrill Lynch, JP Morgan, and Morgan Stanley as underwriters. The money will be placed under a shelf registration and used to repay earlier debt.

*Pimco, the fund manager arm of Allianz SE, the German insurance giant, is suing Wells Fargo over residential mortgage backed securities on which Wells is withholding payments to bondholders for the 2004-5 period. Pimco expected payment after joining in a refinance accord for which Wells is administrator or trustee. The AZSEY sub accuses Wells of “unlawful” looting and “gross negligence” while the US bank says the money is needed to pay legal fees and expenses on the dud bonds. It initially was sued in 2014 for failing to notify bondholders of problems with the mortgages underlying the bonds which then were liquidated by the originator, New Residential Investment Corp, requiring that investors be paid back.

*Santander (SAN) is buying back its 2018 US$ senior notes yielding 3.4%

Other Businesses

*Cemex is investing $50 mn in green projects to cut emissions from its US plants in Miami, Clinchfield, Victorville, and Brookville to gain EPA Energystar ratings, another defiance of Trump, reported by Eduardo Garcia in sentidocomun.com.mx last week.

*Alimentation Couche-Tard is doing a private placement of one or several issues of US$ and C$ senior unsecured notes. We sold fast-expanding ANCUF over worries about its indebtedness. This share is a neige d'antan.

Funds

*SPDR Gold, GLD, was up 1% last week. I am not wearing my Lavender Hill mob earrings. Gold was up for the week.

*Mexican Equity & Income Fund rose to a 52-wk high of $12.07 last week. Its largest holdings are America Movil; Grupo Mexico; Cemex, Banorte; Alfa, Arca, Fomento Economico; and Mexichem. Manager Maru Pichardo doesn't own Bimbo, GRBMF, which I analyzed myself, It was up 2.8% last week.

*Central Europe, Russian and Turkey Fund became a turkey last week as the stock fell to $21.52 and change, down 3.67%,despite its latest NAV coming in at $25.29/sh, a whopping 17.5% discount. This may reflect CEE's board seeking shareholder approval to drop its Russia and Turkey stocks and focus on Central Europe with a new mandate to focus on energy shares. Its largest holdings are Sberbank, Lukoil, Gazprom, and Novatek, all Russian, with MOL Hungarian Oil & Gas only at 3.275 (as of April 30.)

Seoul Sisters

*Korea Fund was up 1.2% last week to $41.645, a new 12-mo high, on Pres., Trump's push on Chinese banks and firms doing business with North Korea. The latest NAV data is $45.95/sh so this is a cheap fund still, at at 10.44% discount reflecting the fact that Kim Jung-Un is a loose cannon even by the standards of Washington DC.

*Japan Smaller Capitalization Fund rose to $11.69 last week after NAV was tallied at $12.96, a 3-mo high discount for the CEF, whose holdings are entirely in companies you never heard of, most at about 2% or less of the portfolio.

*Goldman Sachs ETF Active Beta Japan GSJY opened up 0.22% to $30.116. GSJY is also up on optimism that Pres. Trump can get more Chinese help dealing with North Korea. It invests in well-known large caps and has a liking for consumer discretionary shares.

*Another fund manager has bought 1.13% of Kennedy Wilson Europe REIT, KWEIF, this time Manikay Partners LLC with 1.13%. This is a cheap way to acquire Kennedy Wilson Group, NYSE-KW.

*China Vanke will be part of the private equity consortium buying control of an old Singapore holding of ours, Global Logistic Properties, which operates mostly in China and Japan. We sold when GLPGY's American founder died. The valuation is equivalent to $11.6 bn, squeezed by Chinese groups taking up enough shares in a secondary offering to overrule US Warburg Pincus and Singapore Wealth Fund investors. However the private consortium did out-bid the Chinese management and Hopu Investment of Beijing.