China's Got a Fever

Recs

5

Be A Motley Fool Millionaire!

David Gardner's top pick took an epic run of 1,334%! See what he’s recommending that you buy NEXT.

In most countries, 9% GDP growth is a galloping rate. For China, however, this figure marks a 7-year low, and has prompted acute concerns about social stability. The country's leadership has responded with a stimulus plan that will change the world.

Based on the targets of this spending -- roads, railroads, ports, etc. -- I agree with my colleague Chris Barker that this action relights the torch for commodities. Chris pointed to CNOOC (NYSE: CEO) as a way to play the stimulus, and a recent bit of news strengthens that suggestion.

A CNOOC representative today revealed a plan to invest $29 billion in the South China Sea through 2020. This is one of the world's most prospective deepwater basins, and the statement sends a strong signal about China's commitment to investing in oil for the long haul. This is reassuring in a period of plunging crude prices, and jives with some other major oil players showing signs of life upstream.

I've eyed CNOOC's deepwater prospects before, and Petrobras (NYSE: PBR) has bubbled up as a potential partner. Other firms already prospecting the South China Sea include Devon Energy (NYSE: DVN), Anadarko Petroleum (NYSE: APC), and Newfield Exploration (NYSE: NFX). If you're not interested in going all-in on the China offshore oil story with CNOOC, those E&Ps could give you some exposure, while keeping you rooted here at home.

Of course, a host of oilfield servicers stands to benefit as well. Atwood Oceanics (NYSE: ATW), for example, has a future Chinese drilling commitment under its belt, and subsea systems supplier Cameron International (NYSE: CAM) has a growing presence in the country.

“The Next Great Investment”… That’s how a top global investor describes India’s potential. On Nov. 28, The Motley Fool’s Tim Hanson returns to India to prove it. Follow along in real time and get his TOP pick first (Hanson returned from China in July with a stock that’s up 169%!). Enter email below.

CNOOC is a Motley Fool Global Gains recommendation. Atwood Oceanics is a Stock Advisor selection, and Petrobras is an Income Investor pick. Drill into any of our newsletters, free for 30 days.

Fool contributor Toby Shute doesn't have a position in any company mentioned. The Motley Fool has a disclosure policy.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 25, 2008, at 12:26 AM, aiyoung wrote:

    China's Got a Fever... and the only prescription... is more cowbell!

Add your comment.

Compare Brokers

TD AMERITRADE
more info
ShareBuilder
more info
Power E*Trade

more info
Scottrade
more info
Fool Disclosure

DocumentId: 782124, ~/Articles/ArticleHandler.aspx, 11/24/2009 4:06:55 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

The Must-Read Story on Fool.com
Live Chat on India, China, and the Demise of the Dollar

Related Tickers

11/24/2009 3:51 PM
PBR $51.29 Up +0.16 +0.31%
Petroleo Brasileir… CAPS Rating: *****
CAM $38.21 Down -0.03 -0.08%
Cameron Internatio… CAPS Rating: ****
ATW $37.55 Down -0.41 -1.08%
Atwood Oceanics, I… CAPS Rating: *****
CEO $159.23 Down -2.87 -1.77%
CNOOC Limited (ADR… CAPS Rating: ****
NFX $43.02 Up +1.05 +2.50%
Newfield Explorati… CAPS Rating: ****
DVN $67.45 Down -0.48 -0.71%
Devon Energy Corp CAPS Rating: ****
APC $61.63 Down -0.45 -0.72%
Anadarko Petroleum… CAPS Rating: ****

Community: Investing Wiki

Term Of The Hour

Two and twenty: Two and twenty or 2 and 20 (or other such variants) refers to a common hedge fund compensation structure.

Want to learn more or edit this definition?
Click here to read more!