Sinopec Shanghai Petrochemical Co. (ADR) (SHI), Abbott Laboratories (ABT): The Trends Investors Need to Watch in China’s Slowdown

One of China’s biggest stars still looks to be on pace for solid long-term growth, however. Oil major Sinopec Shanghai Petrochemical Co. (ADR) (NYSE:SHI) has had a tough time this year, with shares dropping more than 10%, but Chinese energy demand is only bound to increase, as the nation’s middle class grows, and urbanization picks up. China and fellow emerging nation India are poised to fuel a 56% growth in world energy consumption over the next three decades, according to the U.S. Energy Information Administration. Sinopec Shanghai Petrochemical Co. (ADR) (NYSE:SHI)’s poised to capitalize on growing domestic demand, especially with the considerable growth in the country’s automotive market. Considering that Sinopec Shanghai Petrochemical Co. (ADR) (NYSE:SHI)’s already one of the five largest firms in the world by revenue, this is hardly a high-risk growth stock, and is a solid option for investors looking for safer Chinese stocks.

If you’re looking to capitalize on that growing middle class, however, there may no greater investor-friendly movement in China than the intense demand for infant formula. Infant nutrition demand has exploded in the country, even though Beijing’s one-child policy has reduced long-term population estimates. Leading nutrition providers like Abbott Laboratories (NYSE:ABT) and Nestle SA Reg Shs. Ser. B Spons (ADR) (OTCBB:NSRGY) have raced to the top of investors’ lists of emerging-market stars. With many Chinese citizens distrustful of domestic infant nutrition, imports have erupted, as a major influx of foreign infant formula products have arrived. China’s surging demand will power these stocks for a long time to come.

The article The Trends Investors Need to Watch in China’s Slowdown originally appeared on Fool.com is written by Dan Carroll.

Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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