5 stocks for the world's new spenders

Once unattainable, Western products are ever more in reach for people in historically poorer countries. Middle-class Indian families munch on Kit Kat bars; aspirational Brazilians enjoy Starbucks coffee; and China's nouveau riche can afford BMWs. The disposable income of tens of millions of people in non-Western countries will continue to explode. McKinsey predicts that some 2 billion people in a dozen emerging economies will spend $20 trillion annually in a decade, up from $7 trillion today. "People will reach a point where their basic needs are taken care of and disposable income increases at a very rapid rate," says Mark Mobius, the dean of emerging-markets investing at Franklin Templeton. "We're seeing that in China. We're going to see it in India before too long. That's pretty exciting." That said, given the historical volatility of such markets, the most stable way to benefit from this transformation is to find strong multinationals with access to a diverse array of markets.

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