China Stock Market May Open Under Pressure

(RTTNews) - The China stock market has climbed higher in two of three trading days since the end of the five-day losing streak in which it had stumbled almost 80 points or 2.7 percent. The Shanghai Composite Index now sits just beneath the 2,970-point plateau although it may see renewed selling pressure on Monday.

The global forecast for the Asian markets is soft, with oil and technology stocks likely to drag the bourses lower. The European and U.S. markets finished with mild losses and the Asian markets figure to follow suit.

The SCI finished modestly higher on Friday as gains from the financial shares and resource stocks were capped by weakness from the property sector.

For the day, the index rallied 21.55 points or 0.73 percent to finish at 2,967.40 after trading between 2,939.98 and 2,985.47. The Shenzhen Composite Index rose 4.04 points or 0.25 percent to end at 1,618.07.

Among the actives, Bank of China rose 0.22 percent, while China Merchants Bank dipped 0.20 percent, Bank of Communications collected 0.40 percent, China Life Insurance perked 0.13 percent, Jiangxi Copper jumped 1.81 percent, Aluminum Corp of China (Chalco) soared 3.81 percent, Yankuang Energy climbed 1.11 percent, PetroChina skyrocketed 6.50 percent, China Petroleum and Chemical (Sinopec) spiked 2.60 percent, Huaneng Power surged 4.57 percent, China Shenhua Energy accelerated 2.00 percent, Gemdale stumbled 2.02 percent, Poly Developments plunged 2.34 percent, China Vanke slumped 1.00 percent and Industrial and Commercial Bank of China and China Construction Bank were unchanged.

The lead from Wall Street is weak as the major averages opened higher on Friday but faded throughout the day and ended mildly under water.

The Dow shed 45.24 points or 0.12 percent to finish at 39,118.86, while the NASDAQ slumped 126.10 points or 0.71 percent to close at 17,732.60 and the S&P 500 sank 22.39 points or 0.41 percent to end at 5,460.48.

For the week, the NASDAQ rose 0.2 percent but the Dow and the S&P 500 both eased 0.1 percent. However, the NASDAQ and the S&P 500 posted substantial gains for the first half of 2024.

The early strength on Wall Street followed a Commerce Department report showing inflation in May matched estimates, generating renewed optimism about the outlook for interest rates.

The subsequent pullback by the markets may have reflected a negative reaction to a turnaround by treasury yields, which initially moved lower following the release of the data but subsequently rebounded firmly into positive territory.

Oil prices showed a modest move to the downside on Friday, coming down from a two-month high on profit taking. West Texas Intermediate crude for August delivery dipped $0.20 or 0.2 percent to $81.54 a barrel.