China's economy stabilizing amid slowing emerging markets

China showed more evidence of stabler economic growth that will help cushion the shocks from recent financial turbulence in emerging markets, the Shanghai Securities News reported Tuesday.

China's National Bureau of Statistics (NBS) spokesman Sheng Laiyun said at a news briefing on Monday that the world's second largest economy will hit the target of 7.5 percent for the year with stabilizing economic growth after a lengthy decline.

Major Chinese industrial firms saw their combined profits rise 11.6 percent year on year in July, a leap from the 6.3-percent rate in June, NBS data showed on Tuesday.

Economic growth fell to 7.5 percent in Q2 after declining steadily for 10 straight quarters, the longest slowdown since China's market oriented reforms began over three decades ago, according to the spokesman.

The announcement strengthened confidence in China's economic recovery as many financial institutions have lifted their forecast for the country's growth in the second half of 2013, according to the news report.

Qu Hongbin, chief economist at HSBC China, said government efforts will further benefit China's economic expansion in the coming months.

HSBC's preliminary reading for China's manufacturing sector showed the Purchasing Managers Index rose to 50.1 in August, the highest level in four months.

Deutsche Bank changed its outlook for China's GDP growth in Q3 and Q4 from 7.5 and 7.7 percent to 7.7 and 7.8 percent respectively.

Credit Suisse lifted the forecast of China's yearly growth from 7.4 to 7.6 percent, while Goldman Sachs, the Union Bank of Switzerland (UBS), Merrill Lynch and Barclays Bank are all optimistic about China's economic prospects, the newspaper reported.

The UBS said turbulence in Southeast Asia and India may affect China through foreign trade at a limited level as China's exports to them was much smaller than to developed countries and regions.

Meanwhile, China's stabler economic growth will help defuse financial unease in its neighboring countries, the report said.

According to latest research by Standard Chartered Bank, China has played a crucial role in boosting Asian economies through increasing investment and consumption since the international financial crisis in 2008.