China’s exports outpaced market expectations in June, with the figure rising 5.8% in dollar terms year-on-year, surpassing the 5% increase predicted in a Reuters survey, according to customs data released Monday.
This came as companies expedited overseas shipments to take advantage of a temporary suspension of U.S. tariffs before an August deadline.
Imports, meanwhile, edged up 1.1% from a year ago. Although this fell short of the 1.3% gain economists had forecast, it marked the first positive growth for inbound shipment this year, breaking a trend of declines against a backdrop of subdued domestic demand.
For the first half of 2025, China’s exports climbed 5.9% compared to the same period last year, while imports dropped 3.9%. The world’s second-largest economy posted a trade surplus of $585.96 billion—up nearly 35% from a year earlier, according to official figures.
U.S. President Donald Trump’s tariff policies have driven Chinese exporters to speed up their diversification into alternative markets—a shift reflected in April and May export data, which showed year-on-year increases of 8.1% and 4.8% respectively, as robust shipments to Southeast Asia and the European Union helped counterbalance falling exports to the United States.
Phillip Securities notes that stronger-than-expected growth in China’s exports signals improving momentum for Beijing, following the United States’ decision to ease tariffs on Chinese goods to 55%—down sharply from the previous threat of 145%.
Meanwhile, a rebound in Chinese imports is being seen as a sign of revived domestic demand, boosted by recent trade negotiations between Beijing and Washington reaching a breakthrough.
Hong Kong’s Hang Seng Index (HSI) and China’s CSI300 have both responded positively to these developments. Against this backdrop, the analyst suggests investors accumulate shares of Xiaomi (1810.HKEX or XIAOMI80 DR), citing its strong international revenue base of over 40% and anticipated support from robust export activity.
The brokerage firm also favors ‘Domestic Play’ stocks that stand to gain from a recovery in China’s internal consumption. Recommended names include Alibaba (9988.HKEX or BABA80 DR), JD.com (9618.HKEX or JD80 DR), and Meituan (3690.HKEX or MEITUAN80 DR), all of which are expected to benefit as the Chinese government takes steps to regulate price-cutting among these leading companies and as import demand shows early signs of revival.
Looking forward, China is scheduled to announce its second-quarter GDP figures on Tuesday, with a Reuters poll of economists projecting a 5.1% growth rate—down from the 5.4% seen in the previous quarter.
