Salient to Investors:
Government measures to stimulate the world’s second-biggest economy have yet to reverse a slowdown that may deepen for a sixth quarter.
China’s economy expanded 8.1 percent in Q1, the least in almost three years and the fifth quarterly deceleration.
Dariusz Kowalczyk at Credit Agricole CIB said industrial profits will continue to be under pressure as the slowdown in the economy is curbing demand and deflation is further squeezing profits – profits may well recover in half2 as the economy is revived by monetary and fiscal stimulus and commodity prices weaken. Growth will drop to as low as 7 percent in Q2.
Bank of America estimates growth will slide to 7.5 percent in Q2.