China

Chandrasekhar Atreya
21 Oct, 2010
New York City

China reported a robust economic expansion in the third quarter. However, 9.6% growth was the third decline in a row but still kept regulators worried on the resurgent inflation. The two inflation measures, CPI and PPI rose in September. China Mobile quarterly earnings rose only 3.5% as competition eats into margins.

[R]5:00 PM Hong Kong, China – China reported a robust economic expansion in the third quarter. However, 9.6% growth was the third decline in a row but still kept regulators worried on the resurgent inflation. The two inflation measures, CPI and PPI rose in September. China Mobile quarterly earnings rose only 3.5% as competition eats into margins.[/R]

China reported fastest economic growth in the third quarter among the largest twenty economies of the world. However, the quarterly growth declined for the third quarter in a row but still the robust expansion has stoked worries of rising inflation and asset prices.

CSI 300 Index in China dropped 0.65% or 22.19 to close at 3,374.69. Hang Seng Index in Hong Kong gained 0.39% or 92.98 points to close at 23,649.48.

Gross domestic product expanded by 9.6% from a year earlier to 26.8 trillion yuan, according to National Bureau of Statistics data released Thursday. The figure was lower than 10.3% growth in the previous quarter and the blistering 11.9% in the first quarter of 2010.

Consumer price index in China rose 3.6% and producer price index rose 4.3% in September from a year earlier, government data showed Thursday.

Mortgage lending rates under the country’s public housing fund program has been raised by 17 basis points for loans of 5 years and under to 3.5% and by 18 basis points for others to 4.05%, according to a statement by the Ministry of Housing and Urban-Rural Development.

The statement came immediately after the central bank raised the benchmark one-year deposit and lending rates at commercial banks.

China’s first interest rate hike in 34 months will boost profits at banks in the short-term but earnings may come under pressure if authorities allow spreads to narrow, analysts said.

China Mobile, the world’s largest mobile operator by users, reported Wednesday a 3.5% rise in quarterly earnings, as a maturing market and intense competition eats into its profits.

The company reported a net profit of 29.65 billion yuan, up from 28.64 billion yuan a year ago.

Shanghai’s container throughput continued to rank first after the port supassed Singapore to become the world’s busiest port last month.

Ports in Shanghai handled a total of 2.54 million twenty equivalent units, up 14.3% from a year ago, local port authority said. Throughput for the first nine months this year jumped 18.5% to 21.6 million TEU’s.

A total of 12 land parcels covering a combined area of more than 370,000 square meters were sold Wednesday in Shanghai for 2.466 billion yuan, according to real estate Web site Soufun.com.

Eight of the 12 pieces were however sold at initial auction prices as the developers feared recent tightening in lending may cool demand.