The iPhone now has 19.5% of the smartphone market in China

In a note to clients — as noted by AppleInsider — Morgan Stanley analyst Katy Humber says Apple’s iPhone installed base in China saw year-over-year growth in May for the fifth consecutive month.

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Apple gained 51 basis points to give it 19.5% marketshare. Huberty says that, ”In our view, "iPhone price cuts, greater usage of financing vehicles, lower VAT taxes and Chinese consumer confidence that is up ~10 points from last summer (per the National Bureau of Statistics of China) are contributing to surprisingly stable demand trends.”

That said, she’s still anticipating iPhone shipments to be down 10% year-over-year in the June quarter, and down 8% in the September period. iPhone sales fell 15% in the December quarter.