Caterpillar (CAT) stock is seeing solid gains as investors shrug off any concerns about the effects of China’s proposed tariffs.

Cleveland Research analyst Adam Uhlman keeps his Neutral rating on CAT.

He is pointing to dealer feedback from Europe that suggests the company and its peers are raising their build rates this year and now expect demand to rise ~10% vs. a prior survey-driven forecast of mid-single-digits, and surveys from Asia show “accelerating demand across mining, construction equipment, aftermarket and power generation.”

Uhlman also says January price increases of 1%-3% across Asia and Europe was met with little resistance from end users.

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