These are exciting times for China! Today, the curtain was lifted on the opening ceremonies for the Beijing Summer Olympic Games, and now, all eyes are on China! For the next two weeks, people all around the globe will be watching the biggest athletic competition in the world, taking place in one of my favorite cities–Beijing.

And I am especially excited because I will get to watch the Games in person during the competition’s second week. As a native Chinese living in the U.S., I want both countries to perform well–I am really rooting for the U.S. men’s basketball team and the Chinese men’s ping pong team to take home the gold.

But I am rooting for the Chinese stock market to perform well, too. That’s because the 2008 Olympics is the country’s “coming out” party –it is China’s chance to show the world its newfound modernism, power and wealth, and prove that, after centuries of economic downturn, it is ready to join the ranks of other world economic superpowers (see also, “Investing in China: Separating Fact From Fiction“).

As an investor in China’s economic growth, countless investors have asked me what I expect from Chinese stocks after the Beijing Olympic Games. Many investors know that most Olympic host countries experience stock market success in the years following the Games, but many are wondering, will the Chinese stock market have the same double–and triple-digit increases that Spain, the U.S. and Greece enjoyed in their post-Olympic years?

The simple answer: yes. I think that there are several factors in line to create this bullish “Olympic effect,” and I think we will see high-quality Chinese stocks, like the ones I recommend in China Strategy, to perform exceptionally well. Let’s look closer at these positive factors supporting the Chinese stock market, and how you can profit from China’s Olympic success.

Three Factors Supporting China’s Stock Market

In recent years, China has enjoyed extraordinary economic progress. The country turned a negative GDP rate from the 1970s into today’s double-digit growth of about 10.0%. And it is experiencing a boost in consumer spending, even as the U.S. economy slows. In fact, Chinese domestic consumption is up 20% this year, while domestic production should have growth of over 15% this year.

This progress comes with great timing, as the commercialization of the Olympic Games is providing an opportunity for more growth in China’s consumer spending– and economy. The Games have become a popular platform for advertisers and sponsors, and their marketing will likely boost domestic consumption after the Olympics. And consider all of the business that China will experience from tourists during the Games and even after once people realize the country is an exciting travel destination with a lot to offer.

In addition to China’s growing economic strength, the second factor supporting the Chinese stock market is the country’s lower inflation rate. In the past 18 months…> the Chinese government has made it its mission to combat rising inflation by raising interest rates six times in 2007, and increasing bank reserve requirements five times so far this year. And these policies have been paying off, as China’s inflation has been calming since its 8.5% peak in April to 7.1% in June.

And thirdly, the Chinese stock market is extremely oversold, and it is due for a correction. After a two-month 80% run-up last autumn, the Shanghai stock market has sold off about 53% from October 2007 to now. And stocks on Hong Kong’s Heng Seng index have corrected about 33% and are trading at levels seen in mid August 2007 (see also, “China Stocks: Economic Indicators Looking Up“).

Because of this, most of the speculative excess in Chinese stocks has been eliminated, and stocks are trading at attractive valuations again. In fact, stocks listed in Hong Kong are trading at under 14 times their earnings this year–a great buy right now, especially considering the slump that most U.S. stocks are in.

These three factors combined are creating a strong likelihood of an Olympics rally in China. And in China Strategy, we are focused on profiting from this over the long term –the weeks, months and years following the Summer Games (see also, “.

How to Invest in China’s “Olympic Rally”

I know there are many investors who are lost trying to decide which Chinese stocks are going to benefit from China’s “Olympic rally,” but I have the best picks for you in China Strategy. I am currently recommending three solid companies that are profiting from China’s economic growth and will likely continue to profit from the coming market rally.

You see, each of these companies is in strong Chinese industries– education, medical supplies and communication technology. And as the Chinese stock market strengthens in the weeks, months and years to come, these are the companies that will continue to grow faster and stronger than others. They each have rock-solid fundamentals in sound industries, and I look for them to lead the way as China’s stock market rallies.

Lock in your profits from China’s Olympic Boom! Sign up now for China Strategy, and get immediate access to the names off all three stocks set to soar from the Olympic Effect. As an added bonus, I’ll send you the names of two additional stocks set to take off in China’s Post Olympic Boom. Join China Strategy Risk-Free today, you don’t want to miss out on this once in a lifetime opportunity!