News Digest:

Chinese companies saw their profits climb amidst a decline in commodity price pressures despite concerns over whether these gains can be sustained for a longer run due to excess capacity in some sectors, according to a news report.

Industrial profits of large companies rose 0.7% in May from a year earlier, while they grew by 4% compared to the numbers in April, as per data released by the National Bureau of Statistics. Overseas demand for Chinese goods resulted in a spike in exports though domestic consumption remained flat to weak in the period.

Takeaway:

These numbers could bring some relief to global copper markets that surged to record highs last month despite low demand from China, which consumes half of its production. Analysts say that recent demand was fueled by fund managers in London and New York, who invested billions of dollars into copper with an eye on future shortages. Chinese purchases had remained low, but news of better industrial profits could lift their demand.

End Notes

Source: https://www.bloomberg.com/news/articles/2024-06-23/hedge-funds-bullish-copper-bets-run-into-china-s-slowdown