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5 Top Stocks for Market Rally of 2011

BOSTON ( TheStreet) -- U.S. stocks' time finally may have come.

Investors, encouraged by a brightening economy, are pouring money into domestic shares and pulling money from emerging markets. With the S&P 500 Index rising at twice the average monthly pace of last year, the smart money is betting on out-of-favor large-cap stocks.

U.S. equity funds attracted $20.6 billion in the five weeks through Feb. 2 as emerging-market equity funds posted their third straight week of outflows in early February, according to EPFR Global. Funds that invest in Europe and Japan have also seen inflows in recent weeks, a trend that continued through Feb. 9.

The fund-tracking firm said Friday that emerging-market funds have had "their worst three-week run in three years, as questions about the economic, political and policy implications of higher inflation continue to dog this asset class."

That money is going to some Japanese and European stock funds, but the bulk of it is going to be invested in blue-chip U.S. stocks, as investors seek to reduce risk while having an opportunity for share-price gains.

For example, fund-consulting firm Strategic Insight reported that investors deposited a net $21.4 billion to U.S. stock funds in January, the biggest monthly increase since a net inflow of $23 billion in February 2004. The last time there had been positive inflows to domestic stock funds was last April.

The S&P 500 is up 2.4% this year after gaining 15% in 2010. But that may be just an inkling of what's to come because fund managers must put all that new money to work in U.S. companies.

So here are five U.S. -based, but international, companies still growing at a fast enough pace to potentially attract new investors and yet carry relatively low valuations. They could benefit if investors are cautious and come back to the market with the view that they prefer quality and slow growth to rocketing returns:

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