How China's GDP growth is relying on the stock market?

A sectoral breakdown of China's 1H15 GDP revealed that the booming financial sector (+17.4% YoY) is crucial in keeping GDP growth at 7%. If the growth is normalised to around 10.4%, 1H15 GDP growth would only be 6.4%. While internet/e-commerce development is seemingly having a big negative impact on traditional sectors like wholesale/retail, their own impact on overall GDP growth seems to be more limited than expectation.

Industrial growth and construction sector growth are both very weak, which dragged down the demand for key commodities like coal and steel, which in turn led to much slower growth of the transportation sector.

Financial sector GDP growth is set to weaken after the stock market crash, and it remains to be seen whether this will lead to the weakening of property sales in key Tier 1 cities - which helped to lift the property sector GDP in 1H15. Revival of industrial sector growth is a must for any improvement in China's GDP growth.