The end of easy oil remains arguably the most powerful driver in the sector, though the unprecedented drop-off in demand that occurred in the wake of the credit crisis and resultant economic dislocation has obscured this long-term trend. But with the global economy and credit markets now on the mend, this theme should come back with a vengeance over the next few quarters.
China is the largest footwear manufacturer in the world, accounting for more than 60 percent of global production. At the same time, it also has the biggest footwear market, with estimated sales of more than 2.4 billion pairs–13 percent of the global footwear sales.
The rally in emerging market equities has been broad based, though the Chinese market has led the way. But next year country and stock selection will become increasingly important to the asset allocation process. Expect “sustainable growth” to become next year’s buzz phrase.
I continue to recommend that investors focus on quality and overweight key cyclical industries. Technology resources, energy and some infrastructure (e.g., ports) remain relatively undervalued in many emerging markets, while valuations in Russia and some other high beta markets remain below previous highs.
The table is set for the US economy to surprise on the upside for the simple reason that expectations are so low. Should this transpire, global markets should easily rise 20 to 30 percent in the next twelve months–even if a correction takes place in the meantime
Since the earlier part of the decade, global emerging markets–led by Asia–have been at the forefront of global economic growth. I expect that trend to continue as they leverage their financial strength to support structural changes in their domestic economies.
Asia’s economic development and aging population bode well for the region’s health care sector.
Chinese policymakers are focused on managing the current boom and, more important, the credit cycle. For this reason, investors should look outside China for the big outperformance–assuming the global economy doesn’t relapse.
It’s no secret to the Internet community that China is the major battlefield for the top companies in almost all the aspects of the business. Search, e-commerce and gaming are the primary areas of contest, with search being the most viable.
If the Democratic Party of Japan wins this weekend’s lower house election, the country’s economic policies could shift. Here’s how to play the change.
