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Costs hit corporate profit growth in May

By LAN LAN and LI JIABAO (China Daily) Updated: 2014-06-28 06:50

Costs hit corporate profit growth in May

Five industries - including vehicle manufacturing, electricity and heating power production and supply - accounted for 77 percent of the profit growth.

Oil refining, coking and nuclear fuel processing recorded 49.3 percent profit growth in the first five months, the highest among all industries. Vehicle manufacturing recorded 29.6 percent profit growth.

Hao said the preliminary reading of the HSBC Holdings Plc and Markit Economics Purchasing Managers Index indicates that manufacturing industries have rebounded and major economic indicators for June will be more optimistic.

Xu Sitao, chief representative of the Economist Group in China, also said an improved reading for the manufacturing PMI in May suggested that the slowdown abated slightly in the second quarter.

To boost economic growth, the government has recently launched modest stimulus measures including tax cuts, accelerating infrastructure spending and targeted reserve requirement ratio cuts to boost funding for smaller companies and agriculture.

"China's economy should grow more than 7 percent this year, but activity has generally been lackluster in 2014, with the property and shadow banking sectors increasing the risk of a more pronounced slowdown," Xu said.

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