Household sentiment weakens in January on shares rout

By Wang Yanlin | February 5, 2016, Friday |

Online Edition

Chinese household sentiment weakened in January due to the country's soft economic performance and the corrections in the stock market, a survey showed today.

The China Wealth Index, compiled by the Bank of Communications and research firm Nielsen every two months, was 119 last month. It dipped from 122 in November but remained much higher than 111 in September.

A reading above 100 reflects optimism among the 1,979 households being tracked.

“The volatile stock market triggered frustration among people” BoCom's Chief Economist Lian Ping said. "Meanwhile, the broader economy remained weak although it did not deteriorate further.”

The component indexes showed people’s confidence in the broader economy maintained at 109 last month while their household income lost 5 points to 132 and their willingness to invest cut 3 points to 111.

“People's loss in the stock market, the main reason for less earnings among households, shook their confidence in the past two months, while employment and other investment income were kept stable," Lian said.

China's stock market had a dramatic start in 2016 after it installed and dropped shortly afterwards the circuit breaker, a system designed to contain wild market swings. The benchmark Shanghai Composite Index has lost more than 20 percent this year, entering a technical bear market.

The index on people’s willingness to buy property also retreated from 105 to 103, partly reflecting the impact of the stock market rout.

China's economy expanded 6.9 percent from a year earlier in 2015, the slowest in a quarter of a century.

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Household sentiment weakens in January on shares rout

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