The Chinese industry's profits increased by 10.2% in the first two months of 2024 compared to the same period of 2023. In 2023, as a whole, they fell by 2.3%.
These figures reveal a notable disparity within the country’s business landscape: While public companies are seeing a modest increase of 0.5%, the manufacturing sector as a whole is flourishing with a robust growth of 17.4%.
It affirms the continuation of the (albeit slow) Chinese recovery and lays the groundwork for a potential rebound. However, a substantial boost in activity hinges on the implementation of new economic support measures.
The Chinese authorities should not stop there. Determined to revive their equity markets, they also watch with interest how improved corporate governance has helped revive the Japanese market and may be inspired by it.
Having underperformed against most other major equity markets, the Chinese stock exchange is not expensive. We buy it as part of all our portfolios.
