The fact that China had been making one after another attempt to bring its economy back on track and did not meet with immediate success led to an impression that things will not improve for the metal sector anytime soon. But on Tuesday, when the GDP numbers came out, they were better than expected, against the expected 4.8 % the numbers came at 5.3 % for the first quarter. While this is a quarter number so there can be some skepticism the fact is that over the last two decades, there have been many issues that the Chinese economy has faced, right from debt to GDP concern to shadow banking to property crisis. They all have been resolved and the economy has been able to make a comeback. So, don’t dismiss these numbers. The biggest impact of a sustained Chinese recovery would be felt by one sector, that is metals and probably the street has a hint of it and that is why metal stocks can outperform even in volatile markets.
