China’s A-shares experienced a 3.2% growth in earnings during the first quarter of the year, bouncing back from a 5.7% drop in the previous quarter.
However, the benefits were not evenly distributed across sectors.
The travel-related consumer services sector saw a surge of 155% in earnings, while the food-and-beverage and automobile sectors experienced more modest growth at 18% and 8% respectively.
Conversely, the home furnishings and apparel sectors saw a decline of 9% in earnings.
The divergence in consumer behavior is further exemplified by the mixed results in sub-sectors, with jewelry brands reporting double-digit growth but leading cosmetics firms experiencing a decline in net profit due to lukewarm online sales.
Analysts believe that consumer confidence will gradually recover over time, leading to an anticipated improvement in earnings in the coming quarters..
