China trade reports positive for July

Just a month after the Chinese trade situation for the third quarter was described as looking “grim”,  the nation has delivered a much stronger than anticipated performance for July which has sent Australia’s major miners climbing over the last two days.

Whilst China’s exports fell for the first time in 17 months in June, the market had anticipated a growth of 2.8% (at an annualized rate) for exports in July, however, a much more impressive 5.1% growth was recorded. Likewise, imports soared 10.9% whilst a rate of just 1.3% had been expected.

Analysts have attributed the impressive results to improved liquidity since June as well as stronger exports to the United States, which The Australian Financial Review reported to be a 5.2% jump compared to a 5.4% contraction in June – despite the Chinese yuan sitting at record highs

There is good news for Australian miners such as BHP Billiton (ASX: BHP), Rio Tinto (ASX: RIO) and Fortescue Metals Group (ASX: FMG) too, with the data revealing that iron ore deliveries were up 26.5* in July compared to June’s mere 6.8%.

Today, BHP, Rio and Fortescue are up 1.8%, 1.4% and 3.95%, respectively.

Foolish takeaway

As it stands, ratings agency Standard & Poor’s believes that China will grow between 6.8% and 7.3% for 2014, whilst it gives it just a 5% chance that GDP growth will be as low as 5% for the year.

Interested in our #1 dividend-paying stock? Discover The Motley Fool’s favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of “The Motley Fool’s Top Dividend Stock for 2013-2014.”

More reading

Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.