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Just as things will heat up for the Summer Games (in ways good and bad), things will similarly heat up for the Chinese small caps. Just in case you haven't realized, a rebound is under way, led by stellar results from various companies' Q1 results. And even for those who have yet to report, bearish sentiments are fading away quite quickly. Just as an example, since I last reported on Universal Travel Group's (UTVG.OB) online gains, the stock is up by more than 40%, over the course of just 5 trading sessions.

Universal Travel Group is certainly a stock that will do well from the Games, benefiting from the confluence of greater spending power and increased travel from both domestic and international tourists. China Yida (CYID.OB) is another, with its world class tourist destination in the Great Golden Lake which, despite it being a little off the beaten path, makes for a great summer getaway.

Media stocks should also be looking up. The only pure play left in the C.O.P. Index is Legend Media (LEGE.OB), an airtime aggregator in the radio advertisement space. This company is still in its ramp-up phase and it will be interesting to see how it deals with the opportunities that will surely come its way this summer.

So the countdown has begun. As attention shifts increasingly to China, Chinese stocks will benefit on the whole, although some will simply wither in the intense glare. My prediction is that by the time 08/08/08 rolls around, many of the C.O.P. stocks will be revisiting the highs achieved in 2007. Don't be left behind.

My Position: Long UTVG.OB, CYID.OB.

Source: 3 China Stocks to Watch as the Olympics Approach