China’s third-quarter economic expansion surpassed expectations, buoyed by policy backing, indicating Beijing’s readiness to attain its roughly 5% growth objective for the year.
Given this favorable economic backdrop, it could be wise to invest in resilient China stocks LexinFintech Holdings Ltd. (LX – Get Rating), X Financial (XYF – Get Rating), and Tarena International, Inc. (TEDU – Get Rating), all of which exhibit substantial growth potential.
China’s economy exceeded expectations in the third quarter, with September witnessing unexpected boosts in consumption and industrial activity. This indicates that recent policy actions are effectively supporting a fragile resurgence, demonstrating a faster-than-anticipated growth trajectory.
In July-September, the country’s GDP expanded 4.9% year-over-year, surpassing analysts’ projected 4.4% growth. Third-quarter GDP surged by 1.3% on a quarterly basis, a notable acceleration from the revised 0.5% in the second quarter and exceeding the anticipated 1.0% growth.
In addition, industrial output in China grew 4.5% year-over-year in September, matching August figures and surpassing analyst expectations of 4.3%. Retail sales also exceeded predictions, rising 5.5% in September, accelerating from a 4.6% increase in August. Analysts expected retail sales to expand 4.9% last month.
Furthermore, China’s foreign trade surged to 30.8 trillion yuan ($4.21 trillion) in the first nine months of 2023. This sets an optimistic backdrop for upcoming economic events such as the Belt and Road Forum, the Canton Fair, the China International Import Expo, and the China International Supply Chain Expo.
These figures indicate that China remains in line with the government’s 2023 growth target of 5%. Notably, Citigroup Inc. (C) now anticipates a 5.3% GDP growth in 2023, up from their earlier estimate of 5%, while JP Morgan Chase & Co. (JPM) and Nomura Holdings, Inc (NMR) project growth rates of 5.2% and 5.1%, respectively.
Furthermore, Goldman Sachs (GS) has revised its forecast to 5.3%, slightly lower than the previous 5.4%, yet exceeding Beijing’s 5% target. JP Morgan economists, led by Haibin Zhu, find the robust September performance encouraging, expecting this economic momentum to continue in the coming months.
The World Bank has also upgraded its projection for China’s 2023 economic growth to 5.6%, a 1.3 percentage point increase from its January forecast. This outlook is more optimistic than the International Monetary Fund’s April projection in its World Economic Outlook, which anticipated China’s growth to remain at 5.2% in 2023.
“Notably, the rapid reopening of…
Continue reading at STOCKNEWS.com