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Stocks are up in a big way to kick off the new week, as the markets have gobbled up positive news from across the Pacific. The Dow Jones Industrial Average (DJINDICES:^DJI) is up 160 points as of 2:25 p.m. EDT. Almost all of the Dow's member stocks are in positive territory so far, but the good news from China is sending industrial stocks to the top of the board. Let's catch up on what you need to know.

Manufacturing's Monday jump
Chinese trade data came through big-time for investors over the weekend, as China's General Administration of Customs reported a 7.2% year-over-year rise in exports for the country in August. Imports picked up strength with a 7% year-over-year gain, but that mark fell short of analyst expectations and also slowed from July's double-digit percentage growth.

Chinese exports are huge for a manufacturing sector that's been in decline for some time now. With Chinese businesses struggling under a cash crunch and many of the world's economies still digging out of the aftermath of the recession, demand has waned for the sector. While the "Made in China" era is slowly declining, the country's still a world leader in trade -- and for manufacturers who have seen sales in Europe and North America erode, China is one of the best hopes for global growth.

Just ask Caterpillar (NYSE:CAT), today's Dow leader with shares up more than 3%. As much as the country's sales in Asia have slipped, Caterpillar's revenue from around the Atlantic has contributed even more to the company's slumping finances. Caterpillar's North American sales fell off by 15% over the year's first half, while the firm's Europe and Middle East revenue dropped 18% year over year. Those two segments produce more than twice the amount of sales that the company's Asia-Pacific segment generates, and even a bounce back from China and the rest of Asia won't fully bring Caterpillar back from its current decline.

It would sure help ease investors' frustration, though. Caterpillar's resource industries division lost 44% of its revenue year over year in the Asia-Pacific region over the year's first half, which was solely responsible for 88% of the company's Asia sales decline. That division suffered drops across the world, but improving its performance around the Pacific alone would do wonders for the company's outlook.

August's export jump won't ease Caterpillar's worries all at once, but if China can avoid a worsening slowdown, Caterpillar will be better able to stem the bleeding.

Alcoa's (NYSE:AA) shares are up 2.3%, making it the Dow's runner-up at the top of the leaderboard today. China's gains might be a boost, but Alcoa also received some help from the U.S. economy in the form of August's purchasing managers' index report. Alcoa has turned toward finished products more and more as the aluminum industry's slump has deepened, and fabricated metal products' pricing increased last month in a small but important win for the company.

Still, investors need to be cautious around this stock. Alcoa's largest segment by sales, its primary metals division, saw revenue drop off by about 10% year over year in 2013's first half. While the company's alumina and finished-products revenue has picked up, it hasn't been enough to halt the company's slide. Alcoa's stock might tempt some investors to buy in on a dip, considering that shares have lost more than 11% year to date, but until aluminum prices bounce back in a big way and oversupply problems cease, Alcoa will struggle to make progress.

Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.