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China's congress Andrew Wong - Getty Images Is China turning around for the better? There's an article on the front page of The Wall Street Journal that is getting a lot of press

this morning: "Emerging World Loses Growth Lead." It argues that developed countries have stronger growth momentum than emerging markets. Maybe, but you wouldn't know that

from how the markets are reacting. Chinese stocks are up in the last month, while Japanese stocks have been trending down. We see it again this morning: The Nikkei is down 0.6 percent (at a

six week low), while the Shanghai Composite is near a two-month high, up 2.4 percent. This morning respected research firm ISI turned bullish on China (at least short-term), arguing that

there is "no economic hard landing" emerging, and that price/earnings ratios (P/Es) are at 11, near a decade low (the average 10-year P/E is 27). We've seen modest a modest

recovery in material stocks like coal and iron ore since China announced better economic data last week, including strong import/export numbers. Industrial production for July rose to a

5-month high, and even the much-watched electricity output rose 8.1 percent in July. There's also talk that back-door stimulus programs are also being used. There was a story in the

South China Morning Post overnight saying "The mainland government is quietly offering financial stimulus to key cities and provinces to help them maintain local economic growth"

and that Agricultural Bank of China, one of the largest state-owned banks, had signed an agreement with the city of Shanghai for a very large (roughly $40.5 billion) loan. Here are major

global indices since the start of the third quarter. While we have often spoke about the improving situation in Europe...China and Brazil have also outperformed. Since July 1 6.1% 6.3%

S&P 500 5.3% Germany 4.5% Japan -1.1% ELSEWHERE: Elsewhere: 1) Japan's Nikkei dropped 0.6 percent, to a 6-week low, as second quarter growth came in at 2.6 percent, below the

forecast of 3.6 percent. The good news is that private consumption was the greatest driver of growth. 2) This may be an unloved rally, but the idea that the public is just sitting it out

isn't born out by the facts. $92 billion has been put into the stock market this year, versus $180 billion in outflows for the same period last year, MarketWatch notes. —_By CNBC's

Bob Pisani_