China Stock Market Overdue For Profit Taking

(RTTNews) - The China stock market has tracked higher in seven straight sessions, advancing more than 280 points or 10.6 percent along the way. The Shanghai Composite now sits just above the 3,000-point plateau although investors figure to lock in gains on Friday.

The global forecast for the Asian markets is positive on continued optimism over the outlook for interest rates. The European and U.S. markets were higher and the Asian markets are expected to follow suit, although profit taking may take hold later in the day.

The SCI finished sharply higher again on Thursday following huge gains from the property sector and more measured upside from the financials and resource stocks.

For the day, the index surged 104.65 points or 3.61 percent to finish at the daily high of 3,000.95 after trading as low as 2,889.01. The Shenzhen Composite Index rallied 63.09 points or 4.00 percent to end at 1,638.36.

Among the actives, Industrial and Commercial Bank of China collected 2.65 percent, while China Construction Bank jumped 2.84 percent, China Merchants Bank spiked 3.60 percent, Agricultural Bank of China added 1.03 percent, China Life Insurance accelerated 2.97 percent, Jiangxi Copper improved 3.72 percent, Aluminum Corp of China (Chalco) surged 6.09 percent, Yankuang Energy strengthened 3.68 percent, PetroChina eased 0.12 percent, China Petroleum and Chemical (Sinopec) perked 0.45 percent, Huaneng Power gained 2.18 percent, China Shenhua Energy increased 2.27 percent and Gemdale, Poly Developments and China Vanke all skyrocketed by the 10 percent daily limit.

The lead from Wall Street is upbeat as the major averages opened higher on Thursday and maintained a positive bias throughout the session.

The Dow rallied 260.36 points or 0.62 percent to finish at 42,175.11, while the NASDAQ jumped 108.09 points or 0.60 percent to end at 18,190.29 and the S&P 500 added 23.11 points or 0.40 percent to close at 5,745.37.

The early rally on Wall Street reflected strength in the tech sector, with chipmaker Micron (MU) helping lead the way higher after reporting better than expected quarterly results and providing strong fiscal revenue guidance.

Stocks also benefited from the release of upbeat U.S. economic data after the Labor Department said first-time claims for U.S. jobless benefits unexpectedly edged lower last week. The Commerce Department also reported that new orders for U.S. manufactured durable goods were virtually unchanged in August.

Oil prices fell sharply on Thursday, weighed down by concerns about excess supply in the market after reports said OPEC will return 2.2 million barrels per day of production cuts back into the market. West Texas Intermediate Crude oil futures for November ended down $2.02 or 2.9 percent at $67.67 a barrel.