China persistently drags world markets down. This time the slump was caused by the latest data on Chinese industrial profits. The data turned out to be extremely weak thus forcing international investors to say once again that the global economy is in a pickle. According to the National Bureau of Statistics, China’s industrial profit plunged by 8.8 per cent on the year basis. These figures are the weakest for China’s industry since 2011. Coal mining as well as oil and gas industry saw the biggest declines of 64.9 and 67.3 per cent, respectively. World stock markets responded to the data by a massive fall in quotes. Japan’s Nikkei 225 slid by 1.3% to 17,163, Russia’s MICEX dropped by 1.42% to 1,616, and the RTS Index edged down by 1.74% to 774. The main European indices decreased by 2% on average. Germany’s DAX lost 2.1% and is seen at 9,484, France’s CAC 40 fell 2.7% to 4,357, and Britain’s FTSE 100 is down by 2.4% to 5,959 levels. Weakness in China’s industry amid stock market collapse suggests a slowdown in Q3 GDP growth by 6.4 per cent.
The Chinese authorities are set to release GDP data in October. Earlier, a sustainable growth of 7% was reported for Q1 and Q2. However, many analysts and investors argue that Chinese officials deliberately exaggerate the real data.
