Creative GDPing. According to the detailed quarter-on-quarter data for China’s March-quarter GDP, there’s 0.5% of growth missing. The main report on Friday revealed the economy grew at an annual rate of 6.7% in the three months to March, which was about what the market had been looking at. A day or two later, quarter-on-quarter data emerged showing March quarter GDP grew 1.1% from the December quarter. Economists say that if you add together the quarter-on-quarter GDP figures for the four quarters to March you get an annual figure of 6.2% (that’s 1.8% in the June quarter, 1.8% in the September quarter, 1.5% in the December quarter and 1.1% in the March quarter). The 1.1% quarter-on-quarter figure for the March quarter is the weakest since the Chinese government started publishing this breakdown of GDP growth in 2012. Given that much of the first-quarter growth was driven by a sharp rise in bank lending and a jump in property investment and prices, you would have to wonder about the overall strength of the economy. — Glenn Dyer
China steel claims rubbery. Meanwhile, don’t believe Chinese claims that crude steel production in the month of March of 70.65 million tonnes was a “record”. The claim received a lot of publicity via a Reuters report. If you go to the World Steel Association website and look at the archived figures for 2014, you find that in May of that year, China produced 71.16 million tonnes of crude steel. Reuters and other reports did not point out that out. Nor did they also make the point that in the three months to March, crude steel production fell 3.2% from a year ago to 192.01 million tonnes in the first quarter. That was also lower than the production in the March quarter of 2014 and was in fact the lowest since the 173.2 million tonnes produced in the first three months of 2012. But iron ore prices continues to rise and rise — it was up 3.1% overnight Wednesday to a new 10-month high of US$64.77. (Goldman Sachs had forecast US$35 a tonne earlier in the year.) No wonder the Aussie dollar climbed back over 78 cents as well. — Glenn Dyer
Old tech dying. Quarterly reports this week from two fading tech giants — IBM and Intel — show conclusively that these once high-flying market leaders have got a bad dose of the old-age staggers. IBM’s first-quarter revenue was the worst in 14 years. Revenue fell 4.6% to US$18.68 billion in the three months to March. Revenue from cloud and mobile computing, data analytics, social and security software rose about 14% in the first quarter. Revenue from the company’s traditional services and hardware segments fell 4.3% and 21.8% in the quarter. Intel is sacking 11% of its workforce, or 12,000 staff in coming months because sales of personal computers continue to fall. Intel says it is shifting its focus to higher-growth areas, such as chips for data centre machines and connected devices. PCs drive around 60% of Intel’s annual sales, and growth is now at a decade low as more smartphones and portable computers are sold than standalone machines. Global PC shipments dropped 9.6% in the March quarter, the sixth consecutive quarterly decline, according to market research group IDC. The fall took unit sales to their lowest level since 2007. Intel’s sales of chips fell 14% from the December quarter (but were up 2% from the first quarter of 2015). — Glenn Dyer
Barbie, Barbie, Barbie. What a little heartbreaker you are turning out to be for owner Mattel Inc. The company’s loss widened in the March quarter thanks to a continuation of the sales slump that has bedevilled some of its key brands such as Barbie. The Barbie line declined 3% in gross sales in the three months to March, better than the 14% drop in the same quarter of 2015, but a fall nevertheless and no doubt a worry after recording its first rise in sales in two years in the important Christmas season in the December quarter. Earlier this year, Mattel announced three new body types for the doll, but this failed to continue the improvement from previous quarters. But Mattel’s “Other Girls” brand, which includes the Monster High and the Polly Pocket dolls lines, recorded a 62% slide, while sales of American Girl slumped 12%. But Fisher Price and Hot Wheels enjoyed small rises in sales in the quarter. The shares fell nearly 6% after hours after a 2.7% fall in regular trading when the wider US market rose. I know of a good line for the fall season — replace Ken doll with the Trump doll, and Barbie with the Clinton doll — should do a bomb in sales. — Glenn Dyer
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