SHANGHAI: Chinese listed companies have registered a strong rebound in corporate earnings in the first half of the year, an indication that solid economic fundamentals will continue to attract global investors to the world’s second-largest economy, leading experts said.

       A total of 1,064 of China’s A-share companies have seen their first-half net profits surge by more than 50% from the same period of last year, accounting for 60% of the total companies who had reported or released guidelines of first-half financial results as of last Thursday, according to data compiled by Securities Times.

       The benchmark Shanghai Composite Index rallied last week as the profit reports reinforced investors’ confidence in China’s economy, while jitters over stricter regulations on after-class tutoring and data security abated.

       The index closed the week up by 1.79% at 3,458.23 points, albeit edging down 0.24% on Friday.

       The net profit growth of all A-share companies may reach as much as 40% year-on-year (y-o-y) in the January-June period, analysts with Haitong Securities said on Friday. The more than 4,000 firms listed on the Shanghai and Shenzhen bourses are due to finish their first-half earnings reporting this month.

       “Even if China is flexing its regulatory muscles and Covid-19 infection rates fluctuate, equities are not likely to suffer if the economic recovery continues,” said Luca Paolini, chief strategist of Pictet Asset Management, a Swiss firm.

       According to Paolini, China’s economic growth has gradually stabilised after a strong comeback from the Covid-19-caused dip, but is still expected to achieve a “very respectable” 10% expansion this year. “I don’t think a withdrawal from Chinese stocks is warranted,” he said.

       Wang Qian, Asia-Pacific chief economist at the United States-based Vanguard Investment Strategy Group, said China is expected to achieve full-year GDP growth of between 8.5% and 9%, as macro policy moderately loosens in order to boost the recovery in demand.

       The country’s quarter-on-quarter economic growth may even accelerate later this year as consumption steadily recovers amid accelerated vaccination and a stabilised labour market, export growth remains resilient, and the recovery in manufacturing and infrastructure investment offsets a softening property sector, she said. — China Daily/ANN