SUSIE GHARIB: Here on Wall Street, U.S. stocks were in the red today on
worries about an impasse in the Greek debt talks. Investors were also busy
digesting a batch of mixed earnings from big blue chip companies. Looking
at the closing numbers, the Dow fell 33 points, while the NASDAQ rose
slightly, tacking on 2.5 points, the S&P 500 lost just over a point.
But the primary concern for investors continues to be Europe. Meeting
in Brussels today, European finance ministers were pressuring Greece and
its creditors to support a deal to restructure that country`s private
sector debt. The move comes as the International Monetary Fund warned today
more preparations are needed to protect against a Greek default. It wants
Europe to double the size of its bailout funds, so any potential default
can be contained. As international markets continue to twist and turn, U.S.
investors are wondering if they should keep their money closer to home.
Suzanne Pratt reports.
SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: For many
Americans, dining in a French restaurant is the only foreign exposure
they`ll ever get. But even if you never travel abroad, most investment pros
say a good chunk of your stock portfolio should go international. That may
be hard advice to swallow, given the recent pictures and headlines coming
out of Europe. On top of that, the poor performance of international stocks
last year left a bad taste with many U.S. investors. The EAFE
shows foreign markets dropped 12 percent in 2011, compared to a 2 percent
gain in U.S. stocks. Many experts predict the volatility will continue in
most global stock markets this year. Still, Vanguard`s Joe Davis says stay
the course when it comes to investing overseas.
JOE DAVIS, CHIEF ECONOMIST, VANGUARD: We keep reminding investors
that you want to embrace the world and own the global equity market,
despite all of its warts. I think, at any point in time, we`re going to
have weakness and concerns. Currently, they`re in Europe. Tomorrow it may
PRATT: Most financial experts say anywhere from 20 to 40 percent of your stock portfolio should be committed to international equities. And most experts like to see an even split between emerging markets and
developed country markets. And despite the unfolding drama in Europe,
strategist Scott Wren says it would be unwise to avoid the region entirely.
SCOTT WREN, SR. EQUITY STRATEGIST, WELLS FARGO ADVISORS: I don`t
think you can expect a lot out of Europe, but I still think that you
probably need some sort of exposure there. But you certainly don`t want to
bet the farm on it, and you certainly don`t want to be overweight Europe.
PRATT: Financial planner Cary Carbanaro says that hasn`t stopped her
clients from worrying endlessly about European stocks.
CARY CARBONARO, CFP, STONEGATE WEALTH MANAGEMENT: I`ve had people say
to me, I don`t want to be in anything international. But the problem is,
asset classes rotate. They rotate every year in and out of favor and you
never know when that asset class is going to recover. And you don`t want to
be completely out of that asset class, because you don`t know how to market
PRATT: So no matter how you might feel about going overseas, it`s
important to remember to put at least some of your money where your mouth
might be. Suzanne Pratt, NIGHTLY BUSINESS REPORT, New York.