Navigating China's Asset Market: Policy Combo Takes Effect, Economic Indicators Improve in September, Forthcoming Q4 Growth Anticipated | Moomoo Research

The "two new" policies significantly boosted consumption of big-ticket items like cars, home appliances, and furniture, with manufacturing investment's year-on-year growth rate increasing for the first time in half a year.

The acceleration of special bond issuance in September led to an increase in infrastructure investment growth.

With multiple regions optimizing real estate control policies, the nationwide commercial housing sales decline continued to narrow.

In September 2024, the year-on-year growth rate of social retail sales reached +3.2%, exceeding the +2.3% expected by Wind Consensus Forecast and the +2.1% of August. On a month-on-month basis, the growth rate for September was +6.2%, higher than the historical average of +2.5%. The two-year compound growth rate for September was +4.4%, marking a continuous four-month increase. Overall, consumer spending saw a rebound in September, driven by the implementation of various pro-consumption policies, indicating a clear marginal recovery in consumer prosperity.

Manufacturing investment saw a slight increase in both month-on-month and compound annual growth rates in September, with a higher growth rate than the seasonal norm, suggesting a marginal acceleration in manufacturing capacity expansion. From January to September, manufacturing investment grew by 9.2% year-on-year, marking the first increase since April. The structure shows that industrial upgrading and equipment renewal policies have significantly stimulated manufacturing investment.

In September, the year-on-year growth rate of infrastructure investment slightly increased from August. The issuance of special bonds has significantly accelerated, which will support future infrastructure investment.

The real estate industry, after nearly three years of adjustment, has shown a "bottoming out" signal. Policies have helped stabilize expectations and accelerate the release of housing demand, and the market in core cities may stabilize in terms of volume and price. Financing tools are expected to form a scale effect, stabilizing the confidence of developers and banks, and accelerating the construction of a new development model for the real estate industry.

In July and August, several economic indicators weakened due to extreme weather and other factors. In response, the Politburo meeting on September 26th emphasized stable growth, and since then, various departments have implemented a range of counter-cyclical policies. Looking ahead to the fourth quarter, with the low base effect and the continuous implementation of a package of stable growth policies, the GDP growth rate is expected to rise, and the third quarter may confirm the bottom of this economic cycle.