High Society

Image source:

What's going on?

China’s making the rest of us feel small: fresh data released on Monday showed the country’s economic activity climbing to new highs in November.

What does this mean?

The data – based on surveys that ask business managers how busy they’ve been compared to the month before – painted a promising picture for the Chinese economy. The country’s manufacturing sector hit its highest activity level in three years, driven by both strong domestic demand and a boost in exports ahead of the Christmas period. Likewise, its services sector – which covers everything from accountancy to hospitality – hit levels not seen since 2012, suggesting life is returning to something resembling – whisper it – normal.

Why should I care?

The bigger picture: Bring on the vaccine.

This data highlights China’s status as the only major economy expected to grow this year. Unlike the US and Europe – where lockdowns are causing even more economic shrinkage – the country has managed to avoid a coronavirus surge now winter’s arrived. And the best could be still to come: some economists reckon the Chinese economy will get another lift when a vaccine becomes widely available, with the US and Europe’s economic recoveries driving demand for its goods. But others argue it might have the opposite effect: anyone with a vaccination might, after all, go straight back to spending their money on restaurants, concerts, and… well, real life.

For markets: Sync or swim.
One investment advisor says investors should think about investing more money in China – and not just because of the country’s role as global economic bright spot. He thinks it’s especially appealing because the worsening US-China trade war might knock the two countries’ economies further out of sync. In other words, Chinese stocks won’t depend as heavily on the West’s performance – and they might just save your portfolio if things go wrong over here.

Originally posted as part of the Finimize daily email.

The top 2 financial news stories in 3 minutes. Join over one million Finimizers

Read next

Merger Counselling

Sign up to Finimize

Get the two most important global financial news stories each day. Sent at midnight UK time.

Get started with one email a day

The top financial news stories in 3 minutes.