Templeton Emerging Markets Investment Trust Plc (NZX: TEM)

Templeton Emerging Markets Plc (NZX: TEM) aims to provide long-term capital appreciation for its investors, via investment in companies operating in emerging markets. 

Recommendation Rationale – Sell at NZD 3.56 

• TEM’s performance might get impacted due to the significant deterioration in the geopolitical environment and slowdown in the global economy.
• In the emerging markets, the risks can be greater as compared to the developed markets.
• The company’s performance is exposed to the risks related to the broader Chinese economy. Any slowdown in China can impact TEM’s financial performance.

TEM’s Daily Price Chart

TEM Daily Technical Chart, Data Source: REFINITIV

TEM is exposed to the risks related to higher inflation, slowdown in the industry, global economic downturn, etc. Given its current trading levels, and risks associated, it is prudent to book profit at the current levels. 

Hence, a ‘Sell’ rating has been provided on the stock at the closing price of NZD 3.56 per share as on 25 October 2024 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Note 1: Past performance is neither an indicator nor a guarantee of future performance. 

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 25 October 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest. 

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.