China's frenzied stock market boom, which soured in the second half
of June, helped drive a surge in financial sector growth that
underpinned the economy's better- than-expected gross domestic product
result.
Financial services surged 17.4 per cent in the first six months from a
year earlier, according to China's statistics authority, as exchanges
and brokerages registered surging revenue amid record trading volume. It
was the stand out industry as real estate languished and agriculture
grew at about half the overall economy's pace of 7 per cent.
The data underscores the fragility of China's growth in the quarter,
as a rout that wiped almost US$4 trillion in equity values may shake
confidence in the sector. That could dent hopes for a pick up in the
economy in the second half.
"To the extent that growth was supported by financial sector gains
from the stock market, it won't be sustained without further stimulus,"
Bloomberg economist Tom Orlik wrote in a note after the quarterly GDP
release on Wednesday.
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