Industry profit hike boosts optimism
Source: Bloomberg News |
October 28, 2012, Sunday
|
Print Edition
Print Edition
CHINESE industrial companies' profits rose in September for the first time in six months, adding to signs economic growth is picking up following a seven-quarter slowdown.
Net income rose 7.8 percent from a year earlier to 464.3 billion yuan (US$74.3 billion), the National Bureau of Statistics said yesterday in Beijing. That compared with a 6.2 percent decline in August, the year's largest drop.
Yesterday's report followed data showing industrial production and retail sales accelerated in September and a manufacturing gauge rose this month. Chinese Premier Wen Jiabao said the economy will keep showing "positive changes," according to a report last week by Xinhua news agency.
"As upstream commodity prices are falling, Chinese corporate profits have room to rise," Wang Tao, chief China economist at UBS AG in Hong Kong, said before yesterday's report.
Huaneng Power International Inc, which develops and operates power plants across China, said on Wednesday that its third- quarter profit rose 757 percent to 2 billion yuan.
Industrial companies' profits in the first nine months of the year declined 1.8 percent to 3.5 trillion yuan, according to yesterday's statement.
Weighed on stocks
That compares with a 3.1 percent drop in the first eight months and a 27 percent gain in the same period in 2011. The government began reporting monthly year-over-year profit changes in October 2011.
Previous profit declines have weighed on stocks, with the Shanghai Composite Index down 6 percent in 2012. The gauge dropped 1.7 percent on Friday.
Revenue for industrial companies in the first nine months increased 10.2 percent from a year earlier to 65.7 trillion yuan, the report showed. Sales rose 29.6 percent in the January-September period of 2011.
Separately, China's economy will probably rebound in the fourth quarter, Jia Kang, a Ministry of Finance researcher, said at a conference in Beijing yesterday. China will meet its full-year growth target of 7.5 percent and "the rebound in the fourth quarter is likely to extend into next year," Jia said.
Net income rose 7.8 percent from a year earlier to 464.3 billion yuan (US$74.3 billion), the National Bureau of Statistics said yesterday in Beijing. That compared with a 6.2 percent decline in August, the year's largest drop.
Yesterday's report followed data showing industrial production and retail sales accelerated in September and a manufacturing gauge rose this month. Chinese Premier Wen Jiabao said the economy will keep showing "positive changes," according to a report last week by Xinhua news agency.
"As upstream commodity prices are falling, Chinese corporate profits have room to rise," Wang Tao, chief China economist at UBS AG in Hong Kong, said before yesterday's report.
Huaneng Power International Inc, which develops and operates power plants across China, said on Wednesday that its third- quarter profit rose 757 percent to 2 billion yuan.
Industrial companies' profits in the first nine months of the year declined 1.8 percent to 3.5 trillion yuan, according to yesterday's statement.
Weighed on stocks
That compares with a 3.1 percent drop in the first eight months and a 27 percent gain in the same period in 2011. The government began reporting monthly year-over-year profit changes in October 2011.
Previous profit declines have weighed on stocks, with the Shanghai Composite Index down 6 percent in 2012. The gauge dropped 1.7 percent on Friday.
Revenue for industrial companies in the first nine months increased 10.2 percent from a year earlier to 65.7 trillion yuan, the report showed. Sales rose 29.6 percent in the January-September period of 2011.
Separately, China's economy will probably rebound in the fourth quarter, Jia Kang, a Ministry of Finance researcher, said at a conference in Beijing yesterday. China will meet its full-year growth target of 7.5 percent and "the rebound in the fourth quarter is likely to extend into next year," Jia said.
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