China GDP is growing at 11.9% and the inflation pressure is building. The real estate market is red hot. I expect the central bank will start to increase interest rate soon and to cool down the economy. It will have impact on global economy. The reasons for most global companies, like intel and UPS, to post strong earnings can be attribute to China more than to U.S.
By the way, the earning surprise on UPS should not be treated as a buy signal. The valuation is not cheap on UPS and the higher fuel prices will have an impact on its earning going forward. My feeling is 2010 and 2011 will be the peak earnings for UPS and other transportation companies. Most of them are traded close to 20P/E. I am not comfortable.
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