To the
rest of the world, the Chinese consumer is one of the most promising hopes for future
economic growth. In the distant future, when the United States, Europe
and Japan will have no option but to slow their spending and pay off
their debts, China
could pick up the slack. Experts forecast millions of Americans
with jobs that exist to design, make or sell goods and services to the
Far Eastern giant. This might explain why political parties,
economists, corporate executives and labor leaders all devote so effort in urging
China to increase consumption.
The rise of China is inevitable. It is the world's most
populous country, now reclaiming its long-lost power, but to continue growing
rapidly, China
needs to make the next transition, from sweatshop economy to
innovation economy. This transition is the one that has often proved
difficult elsewhere. Once a country has turned itself into an export
factory, it cannot keep growing by repeating the the cycle. Eventually,
its rising economy needs to take two dire steps by manufacturing
quality goods that aren't just cheaper than the competition; and create
a thriving domestic market, so that its own consumers can pick up
the slack when exports inevitably slow.
The China 100 Stock Index closes at 924.43
(+1.41%). L & L International Holdings
leads the gainers up 23.70%. Yanglin
Soybean, Inc. was the biggest loser down (74.00%).
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Biggest Gainers For The Week
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L &
L International Holdings (LLEN) closed this week with a bullish gain of +23.70%
after the coal mining and distribution business announced an agreement
to provide a secured bridge loan to Bowie Resources, LLC which
owns and operates a Colorado based coal mine. L&L will
provide $3 million in loans as initial funding that will be used to fund
Bowie's ongoing coal mining operations.
With a +17.75%
gain, China Education Alliance Inc. (CEU) fought back against
fraud charges by having their auditors perform
a check on their cash balances. The company also stated that
this year's annual meeting of stockholders will be held on Monday,
December 20, 2010.
China
Mass Media Corp. (CMM) finished the week with a gain of +14.66%.
The independent television advertising company in the People's Republic
of China was recently audited
by the acclaimed Big Four firm PricewaterhouseCoopers. China
Mass Media has earned a little more than $3 million and generated more
than $15 million of free cash flow.
Suntech
Power Holdings (STP) finished this week up +14.03%
after Auriga USA has upgraded
Suntech holdings from buy hold to raising its price-target on the
Chinese solar panel maker to $11 from $9.
Another
double digit gainer is Taiwan Semiconductor Manufacturing Co. Ltd. (TSM) up
+10.92%.
Sales
and profits are at the top of their game as continued demand for chips
is utilized everything ranging from cars to computers, smartphones and
gaming consoles has hustled the market. The particularly strong
sales are packages which are used in gaming devices and T.V.s.
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Biggest Loser For The Week
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The
largest drop amongst the bearish companies is Yanglin Soybean, Inc. (YSYB)
with a loss of -74.00%. A huge
disappointment
and drop in confidence after the soybean manufacturing company issued a
press
release announcing its unaudited financial results for the
third
quarter of 2010.
A-Power
Energy Generation Systems, Ltd. (APWR) experienced a drop of
-26.15%.
Falling well short of analysts' expectations, shares of the energy
company plunged Wednesday after it reporting
a larger third-quarter loss than a year ago.
This was a
bearish week for Cninsure Inc. (CISG) with a loss of -23.04%
after the Chinese insurance and claims service provider announced a $100
million buy back of its U.S.-traded shares. The repurchase
will take place by June 30 and funded with available cash. This
event is to demonstrate the company's confidence in its long-term growth
prospects.
With a -21.21%
decline, China Architectural Engineering, Inc. (CAEI) makes the
list of weekly losers after recently announcing its financial results
for the third quarter. The self-developer of online games and a
provider of high-end building envelope architectural systems showed
a decrease of $21.2 million, or 83%, from $25.6 million
for the comparable period in 2009.
China
BAK Battery, Inc. (CBAK) closes out the losers list. The maker of lithium-based
batteries finish the week with a -17.76%
decline. Chief
Financial Officer Jon Zuo resigned for personal reasons.
Succeeding Zuo on an interim basis is Marcus Cui, China Bak's director
of investor relations.