Profits earned by China's industrial sector in November fell 1.4 percent year-on-year, official data reportedly showed Sunday. The fall marked the sixth consecutive month of decline with the biggest drop in profits seen in China’s mining sector.
The numbers also showed that industrial profits fell 1.9 percent in the first 11 months of the year, compared with the same period a year earlier. In October, profits sank 4.6 percent from a year earlier. The official survey covers large enterprises with annual revenue of more than 20 million yuan ($3.1 million) from their main operations.
"The November industrial profit data matched earlier output data and they showed some signs of stabilizing, which are in line with recent data from other Asian countries," Zhou Hao, China economist at Commerzbank in Singapore, told Reuters, adding that the figures were slightly better than market expectations.
Profits of state-owned enterprises among major industrial firms saw a 23 percent slump in the first 11 months this year from the same period in 2014.
A jump in profits of auto manufacturers and electricity sector helped narrow overall declines in November, Reuters reported, citing China’s National Statistics Bureau.
"Declines in industrial profits narrowed in November, but uncertainties still exist," He Ping, an official of the Industry Department at NBS, told Reuters. He added that inventory of finished goods grew at a faster pace last month.
According to recent data, the producer price index (PPI), a measure of costs to manufacturers, contracted 5.9 percent in November. PPI has been shrinking in China for nearly four years, pointing to weak domestic demand and overcapacity.
Last week, the Chinese government outlined its main economic targets for next year, promising to introduce "supply-side reforms" and generate new growth engines to tackle with overcapacity issues and booming inventories. The government also projected industrial production to grow at about 6 percent in 2016 -- the same pace as in 2015.