The Chinese economy returned to growth in the second quarter, marking an important milestone in the global struggle to climb out of the slump brought about by the coronavirus.
Gross domestic product expanded 3.2% in the three months to June from a year ago, reversing a 6.8% decline in the first quarter and beating the median forecast of 2.4%. However, the economy is still 1.6% smaller than at the end of the first half in 2019.
Having shut its economy in the first quarter to arrest the virus spread and managed so far to largely defeat subsequent outbreaks, China is claiming success in dealing with the impact of the deadly disease. Yet a conservative stimulus approach has produced only a modest domestic recovery, and one that remains highly vulnerable to setbacks in external demand as shutdowns continue to hamper activity elsewhere.
The CSI 300 Index fell 1% at 10:54 a.m. local time, heading for the first three-day loss since May, further evidence that the recent exuberance in Chinese stocks is fading.