With the U.S. stock market valuations looking robust in the face of prospects for a step-down in economic activity in the near term, I???m searching for other opportunities elsewhere for subscribers to my investment newsletter PowerTrend Profits. While not robust, the vector — or direction — of the economic data coming out of both the euro zone and Asia is far better than that on the home front, where we continue to be plagued by tepid job creation and tight wages. Both the euro zone and China have emerged from contracting economies, and recent new-order and backlog data points to a pickup in several territories.
China???s non-manufacturing Purchasing Managers??? Index (PMI) for October rose to its highest level this year. The non-manufacturing PMI rose to 56.3 in October from 55.4 in September, according to the Beijing-based National Bureau of Statistics and China Federation of Logistics and Purchasing. That jump follows the October manufacturing Purchasing Managers??? Index from HSBC and Markit Economics that rose at the fastest pace since March. Driving that improving manufacturing picture was a rise in both new orders and new export orders.
A case in point is wholesale deliveries of cars, with multipurpose and sport utility vehicles rising 24% to 1.61 million units in October, according to the state-backed China Association of Automobile Manufacturers. Through the first 10 months of this year, 17.8 million vehicles were delivered and 14.5 million of them were automobiles. Sifting through the data, we find that Ford (F), General Motors (GM), Toyota (TM) and Honda Motor (HMC) all benefitted from the pickup in sales.
Read more about the investing potential of China and the euro zone at Eagle Daily Investor.