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Quarter-End Insights

Our Outlook for Industrials Stocks

The industrial sector continues to enjoy decent U.S. growth, but slowing in China and Europe is a near-term concern.

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  • The industrial sector likely enjoyed solid, if slower, growth in the first quarter, led by continued advancement in the U.S. economic environment and further gains in emerging markets.
  • Both housing and nonresidential construction spending look to climb in the near term, with several leading indicators suggesting more-positive results over the remainder of 2012.
  • Overall, we don't think valuations in the industrials universe currently offer sizable margins of safety, although we still believe investors can enjoy some opportunities in individual companies.

 

Adam Fleck does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.