China’s economy returned to growth in the second quarter, in one of the world’s earliest signs of recovery from the fallout of the coronavirus pandemic, reported the Financial Times.
Gross domestic product grew 3.2% in the three months to the end of June, compared with the same period last year. The positive economic data follow the first annual decline in decades in the previous quarter, when China’s GDP fell 6.8% as the country struggled to deal with the impact of the Covid-19 crisis.
Despite the return to growth, China’s stocks fell by the most in more than five months on Thursday after data showed a mixed recovery, with strength in the country’s industrial sector balanced against continued weakness in consumption. The CSI 300 of Shanghai- and Shenzhen-listed stocks closed down 4.8% in its biggest drop since early February, while Hong Kong’s Hang Seng index lost 2%.
“Maybe today there’s some kind of realization that while the industrial side of the economy is really being driven by fiscal stimulus, the consumer side of the economy is a bit more problematic,” said Tapas Strickland, an economist at National Australia Bank.