Out-Law News | 22 May 2014 | 10:19 am | 1 min. read
Analysts' forecasts for more than 1,500 companies listed on the Shanghai and Shenzhen stock exchanges predict that net profit in the industrial sector will grow by 44% in 2014. The consumer discretionary sector, which offers goods and services which are not regarded as necessities, is forecast to record a net profit increase of 42%. Net profits in the energy sector are expected to grow by 5% this year.
Newly-completed earnings reports for January-December 2013 reveal that overall income rose by 13.8% last year, Reuters said. Strong performance by information technology firms as well as consumer goods and materials helped boost the figure. The three sectors are expected to record the fastest profit rises since 2010, according to the data.
The financial sector, which accounts for more than half of overall earnings among mainland-listed companies, is expected to post an average net profit growth of 10.3% in 2014. That would represent the slowest growth in this sector in six years, said Thomson Reuters.
"The weaker economy is expected to sap demand for fund-raising, which will cast a shadow on banks' earnings this year," Cao Xuefeng, head of research at Huaxi Securities in Chengdu city, capital of Sichuan province, told Reuters.
The predictions come as China forges ahead with its stated goal of creating a more mixed and market responsive economy.
China's annual economic growth slowed to an 18-month low of 7.4% in the first quarter of 2014 according to Reuters.