Publicly traded Chinese companies reported slowed earnings growth in the second quarter, as moderation in economic expansion and a flare up in the US-China trade war hit profits, said the South China Morning Post. Earnings season has wrapped up for another quarter, with companies trading on the Shanghai and Shenzhen exchanges releasing their first-half results by the end of last month. The companies posted a 6.5% increase in earnings for the April-June period, compared with a 9.4% growth rate for the first quarter, said Haitong Securities.
The interim results also signaled that corporate earnings have yet to bottom out, as a pickup in first-quarter growth turned out to be a false rebound. The deceleration in profit growth could also mostly explain why a run-up on Chinese stocks since the start of this year has faltered, reported SCMP. The Shanghai Composite Index now remains down about 8% from a high in April, as traders pull out of equities over concerns that gains in stock prices have outstripped earnings prospects.
