China markets were up in overnight trading, being fueled by a moderate decline in the China Manufacturers purchasing index. The Shanghai A shares were up 1.48%, and the B Shares were up .78%.
Think there’s no consumer growth in China? Think again. China Telecom reports Q2 profits rose 12% as its mobile phone subscriber base increased by 50%. The stock was up 4.8% on the news in Hong Kong.
Markets are firming up very tepidly globally on hopes the Federal Reserve will announce some sort of QE3 program to shore up the US economy.
The Chinese Purchasing Manager’s index rose slightly over July – from 49.3 to 49.8. A reading below 50 indicates contraction, but the slight improvement suggests a soft landing.
China has made investments in the production of oil in Libya. And, while China has never had a strong relationship with the nearly ousted Gaddafi, they have been supporting the rebel cause. One rebel faction warned China could lose its assets through nationalization, and the Chinese retorted with harsh words.
This weekend’s Barron’s cover article suggests it’s Time to Buy Emerging Markets after a 20% drop in China, Brazil, and India-Author Chris Williams notes their currencies are holding up against the dollar and the euro, their balance sheets are strong, and they’ve already completed their deleveraging cycle. Prices are also low as $7.7 billion came out of emerging market funds in August alone.
Barron’s also reports legendary and long term Fidelity Fund manager Mark Mobius, a pioneer of investing in China, India, and Russia, is buying up stocks that relate to consumer spending.