Aust stocks unmoved by shrinking China growth

Local market closes unchanged as investors sit on their hands after China's GDP slows in line with consensus.

Investors sat on their hands in a lacklustre session that saw the Australian stock market close flat with China's GDP slowing in the second quarter, validating concerns about waning growth in the world's second-biggest economy. 

At the 1615 AEST official market close, the benchmark S&P/ASX200 index edged 0.14% higher to 4,981.1 points, while the broader All Ordinaries index inched 0.16% higher, to 4,965.6 points.

China's second quarter GDP came in at 7.5% for the quarter, in line with market consensus.

CMC Markets senior trader Tim Waterer said there was a minor sense of relief attached to the Chinse GDP result today, despite the result being in line with expectations.

"To see the number come in on par with the Chinese Government’s growth target offered mild comfort to risk assets today," Mr Waterer said.

"Across the market there was still an air of caution with traders mindful that the rate of growth in the world’s second-largest economy still appears to be on the wane (compared to the previous GDP print of 7.7%)."

IG market analyst Chris Weston said Chinese authorities had been added to the lack of certainty on the country's growth for 2013, with Finance Minister Lou Jiwei’s comments on Friday that growth for the year could be 7% corrected over the weekend to, "there is no doubt that China can achieve 7.5% growth".

"The in-line GDP print though was probably the most market-friendly outcome possible, given how good news has been taken badly by the ‘we want stimulus brigade'," Mr Weston said.

Mr Waterer said traders' would turn their attention to the United States to see whether Federal Reserve chairman Ben Bernanke wears his hawkish or dovish cap when giving testimony to Congress later in the week.

Related Articles