Breakout in Caterpillar shares highlights global economic strength ...Middle East

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Investment in that kind of equipment is telling. It offers visibility into whether companies, miners, and builders are willing to spend real money on the future. When they step up, you’ve got green shoots. When they pull back, the global economy is already slowing.

Caterpillar is a classic global growth barometer as it operates in 190 countries and is particularly leveraged to China. Its turn signals an improvement in China growth prospects that's also underscored by the rally in Chinese equity markets this year.

All told, the rally in Caterpillar shares is a great sign for the economy and the broader stock market. It argues that the rally should extend beyond technology and that's something that's happening today with the Russell 2000 up 2.30%.

This article was written by Adam Button at investinglive.com.

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