- China's manufacturing sector is on the brink of passing that of the United States, according to a report released Monday. Analysis of the latest government readings by economic research firm IHS Global Insight show that China's manufacturing sector nearly caught the U.S. output in 2009. The value of goods produced by China's factories reached about $1.6 trillion last year, compared to $1.7 trillion by U.S. manufacturers.
With that said, we saw the market weakening in late April, early May on perceived good news so you just can never tell what the market will do. In the short run it has little to do with the economy. For example this afternoon all Ben Bernanke has to do is spread his pixie dust and promise free money forever and ever and we might put on a giddy rally. Who knows.
Two ancillary measures are also not confirming this rally.... or better put, are showing continued slowdown in the world economy. (Doctor) copper - after being bludgeoned in the May selloff, has not shown much life other than a dead cat bounce.
And the Baltic Dry Index (which I don't consider as important as copper) is down 17 sessions in a row and at lows of 2010.
Most likely these say as much about China than they say anything about Europe and the U.S. - which have simply been limping along as China drags the world around like a ball & chain around it's proverbial ankle. [Feb 9, 2009: China and the Baltic Dry Index - What's Really Going On?]