China Economic Statistics and Stock Market Index Performance

Includes: EWH, FXI, SPY
by: Richard Shaw

News about China's economy is frequently mentioned in the financial press, but most of the time people, including us, dont have a solid historical frame of reference to know how significant that economic news really is.

This article presents a series of important historical China economic data from TradingEconomics. If you follow China, these data should be helpful for perspective.

This article also discusses two popular Hong Kong stocks ETFs. EWH and FXI and compares the performance of the Hong Kong market to the two major mainland China markets; the Shanghai index and the Shenzhen index. Those comparisons show the strong difference between the stock performances of Hong Kong vs. the mainland.

China Economic Data

China's 1-year benchmark interest rate at 6.31% compares to a 1996-2010 average of 6.49%, with a high during that period of 10.96% in June 1996 and a low of 5.31% in February 2002.

China was clearly increasing the rate in the build up to the 2008 world stock markets crash, as they apparently saw overheating. At this point, the rate is approximately in the middle between the level at which it began raising rates in the last cycle and the point at which rates topped out and world markets declined.

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China's 10-year government bonds at 3.84% compare to an average of 3.57% from 2005 through the current time in 2011, with a high of 4.61% in July 2008 and a low of 2.70% in January 2009.

China's inflation rate at 5.3% compares to an average of 4.25% from 1994 through 2010, with a high of 27.7% in October 1994 and a low of negative 2.2% in March 1999. The inflation is above average now, and on an upward slope.

China's monthly balance of trade was surplus $11.04 billion in April 2011, and is estimated to be $155.69 billion on an annnual basis.

China's industrial production in April grew at an annual rate of 13.4% compared to an average of 13.46% from 1990 through 2010, with a high of 29.6% in August 1994 and a low of negative 21.1% in January 1990.

China's GDP growth rate was 9.7% in Q1 compared to an average of 9.3% from 1989 through 2010, with a high of 14.2% in December 1992 and a low of 3.6% in December 1990.

China's GDP is on a steady march, and at $4.9 1 trillion represents 7.9% of world GDP. In 1960, China GDP was $46.5 billion. Those numbers compare to the United States which currently has a GDP of $14.3 trillion accounting for 23% of world GDP. In 1960, the United States GDP was $521 billion.

China's per capita income is $1,965 compared to an average of $94 from 1960 through 2008, with a high of $1,965 now and a low of $72 in 1960.

China's per capita income on a PPP (purchasing power parity) basis is $5,971 compared to an average of $1,857 from 1960 through 2008, with a high of $5,971 now and a low of $250 in 1960.

Percentage Performance Comparison: ETFs and Indexes:

On an 8 year basis, the Hong Kong ETFs and the Hong Kong / China indexes beat the S&P 500 (proxy (NYSEARCA:SPY)). On a 4 year basis, each except Shanghai, beat the S&P 500. On a 1 year basis, only the Hong Kong ETF beat the S&P 500 index.

Longer term the general expectation is for China to once again outperform, but it is not happening at this time.

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8 Years Monthly

4 Years Weekly

1 Year Daily

Hong Kong ETFs:

Both FXI and EWH are trading approximately at the 10% correction level, and approximately at the 200-day moving average. The 200-day averages are not trending down at this time, although the average for FXI is virtually flat.

Note that the dotted red line plots 95% of the highest daily high price over the past year (252 days). The dashed red line plots 90% of the trailing high. The solid red line plots 85% of the trailing high, and the bold red line plots 80%.

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$227 billion index market-cap

25 constituent companies


$592 Billion index market-cap

40 constituent companies

Key China Stock Market Indexes:

The Hang Seng (Hong Kong) index chart looks a lot like the ETF charts, but the mainland Shanghai and Shenzhen indexs are in down trends (based on the slope of the 200-day average), and have declined more from their trailing highs than the Hang Seng.

The Shanghai is down at the 15% severe correction level, and the Shenzhen is down 20% at the bear market level.

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Hang Seng Composite

$2.67 Trillion total market-cap

1421 listed companies

Shanghai Composite

$2.7 Trillion total market-cap

900 listed companies

Shenzen Composite

$1.3 Trillion total market-cap

1211 listed companies

Top Holdings and Sector Allocation of Hong Kong ETFs:



Total Holdings of Hong Kong ETFs:



Disclosure: We do not hold and mentioned stock as of the publication date of this article.

Disclaimer: This article provides opinions and information, but does not contain recommendations or personal investment advice to any specific person for any particular purpose. Do your own research or obtain suitable personal advice. You are responsible for your own investment decisions. This article is presented subject to our full disclaimer found on our site available here.