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Petrobras' Giant IPO Just a Bubble Omen?

IPO desks, which have had a miserable year, are salivating over the success of the Petrobras deal, which raised $67 billion in the largest secondary offering ever.

Not so fast, skeptics have been telling me. This is a vote on investing in emerging markets, particularly Brazil, they say, where investors have been throwing so much money at the country that the central bank there has been buying dollars in a desperate attempt to keep its own currency from going through the roof.

They have a point: the main emerging market ETF, the iShares MSCI Emerging Markets Index Fund is now at the highest level since 2008. Major emerging markets like Jakarta (Indonesia) and the Phillipines are at historic highs, while Korea and India is at the highest level in over two years.

We'll soon find out: there are THREE Chinese IPOs that will price in the U.S. next week:

- internet content provider ChinaCache International (check when live)

- fast food restaurant chain Country Style Cooking (check when live )

- and wind turbine manufacturer China Ming Yang Wind Power (check when live ).

Still, you have to be encouraged by the IPO action this week. Renaissance Capital said that with 9 deals this week, this will likely end up being the busiest week for US IPOs since December 2007.

Just look at today: software firm SciQuest priced at $9.50, the low end of its range, but opened at $11.50 and midday was trading above $13.50.

And the big deal next week? Not Chinese — classic American. Property-casualty insurance giant Liberty Mutual Agency (check when live ) is seeking to float 64.3 million shares at $18-$20 — that's about $1.2 billion, one of the largest IPOs of the year.

That's the one I will be watching. Should price Thursday night for trading Friday morning.

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  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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