China Stocks to Watch

This week's portfolio includes DryShips, Baidu.com and Gushan.
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The Chinese stock market, like much of the rest of the world's stock markets, has sold off hard this year in the face of a slowing global economy. Its stocks have been battered despite the fact that the Chinese economy is holding up noticeably better than the rest of the world.

China is still growing its economy fast, at 7.5%, despite global economic issues. Also, the Chinese government is becoming more proactive with its efforts to save its stock market and economic future. For example, on Nov. 26, the People's Bank of China

cut interest rates by

1.08 percentage points to about 5.6%, the largest cut in 11 years.

Another big move by the Chinese government was its announcement of a gigantic $586 billion economic stimulus plan package that aims to bump up growth by 2 to 3 percentage points. Under the package, China will pour money into infrastructure projects and education, as well as environmental protection and high technology.

Investors now have one more reason to be hopeful. Leaders in the Far East are set to hold a high-level meeting this week. Analysts are expecting more government polices to be announced to spur economic growth, such as boosting exports, injecting capital into China's stock market and raising social spending.

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