Standard & Poor's says that almost 50% of all revenues from S&P 500 companies now come from non-U.S. sources. This report highlights the role overseas markets must play in a U.S. rebound. (In a post on Monday, I discuss the weakening dollar and its affect on U.S. exports.)

I have seen some of these linkages creep into the stock markets. Interestingly, both the Chinese and U.S. markets were declined at the end of August as fears were raised that China would pull back on some of its stimulus efforts. Shanghai stocks were down over 20% on worries that China was going to restrict bank loans. U.S. stocks were down far less, but the China shock put a damper on the U.S. market.   More 

I have written over the past several weeks that the U.S. consumer had been a bit weaker than I had hoped and that some U.S. exports opportunities had helped offset some of that weakness. A weakening dollor, and a stronger-than-expected Chinese economy, bodes well for continuing export opportunities for the United States. Although the July trade deficit announced last week was up, export growth was in positive territory growing over 2%. In other positive news, initial unemployment claims were down 25,000, moving the trend in the right direction after two disappointing weeks.

Good news also continues to pour in from our individual companies; both Federal Express FDX and Texas Instruments TXN raised expectations. Also visible are alternative methods for firms to raise money outside of the conventional banking cycle. On balance, the news flow is positive and continues to point to a strong second half of the year.   More