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Can you remember back to February, when the Chinese PMI was slowing, and the country posted a trade deficit, and nobody felt totally 100% confident that it was just a matter of the Lunar New Year?Yeah, that was ages ago. The more data that rolls in, the more it looks as though that was all just a headfake.
The latest: the all-important cargo data, which speaks to both the Chinese and American economies.
From Citi’s Christian Weatherbee:
Shanghai Air Cargo Volumes Rebound in March – Air cargo tonnage from the Shanghai Pudong International Air Cargo Terminal grew 8% YOY in March, returning to growth following an 8% decline in February. In addition, the total tonnage of 123,886 is the third highest amount posted in the terminal’s history and is only 3% off peak volumes from October 2010, which is a seasonally stronger month. For 1Q11, volumes were up 5% YOY, which is quite strong compared to the 97% YOY growth in 1Q10. Given the tight historical relationship between Shanghai’s air cargo volume and those more closely followed from Hong Kong, we believe a solid number from Hong Kong in the coming days is likely and would be an incremental catalyst for the group.
Between the resumption of growth, and the widespread belief that the tightening cycle is nearing it’s no wonder that bullishness on Chinese stocks is increasing.