Winning Streak May Continue For China Stock Market

(RTTNews) - The China stock market has tracked higher in back-to-back sessions, gathering more than 80 points or 2.6 percent along the way. The Shanghai Composite Index now sits just beneath the 3,350-point plateau and it may stretch its winning streak on Monday.

The global forecast for the oversold Asian markets is broadly positive, with the oil, technology and financial sectors expected to lead the way higher. The European and U.S. markets were up and the Asian bourses are expected to open in similar fashion.

The SCI finished modestly higher on Friday following gains from the insurance companies, weakness from the properties and financials and a mixed performance from the energy companies.

For the day, the index advanced 29.60 points or 0.89 percent to finish at 3,349.75 after trading between 3,322.95 and 3,356.71. The Shenzhen Composite Index climbed 28.66 points or 1.32 percent to end at 2,192.67.

Among the actives, Industrial and Commercial Bank of China shed 0.63 percent, while China Construction Bank lost 0.50 percent, China Merchants Bank rose 0.15 percent, Bank of Communications fell 0.40 percent, China Life Insurance climbed 1.34 percent, Ping An Insurance improved 1.10 percent, Jiangxi Copper retreated 1.63 percent, Aluminum Corp of China (Chalco) slid 0.42 percent, Yankuang Energy declined 1.50 percent, PetroChina skidded 1.11 percent, China Petroleum and Chemical (Sinopec) perked 0.25 percent, Huaneng Power jumped 1.79 percent, China Shenhua Energy sank 0.51 percent, Gemdale plunged 2.67 percent, Poly Developments tanked 2.05 percent, China Vanke slumped 1.24 percent, Beijing Capital Development stumbled 1.02 percent and Bank of China was unchanged.

The lead from Wall Street is upbeat as the major averages opened sharply higher on Friday and remained that way throughout the trading day.

The Dow surged 823.28 points or 2.68 percent to finish at 31,500.68, while the NASDAQ rallied 375.42 points or 3.34 percent to end at 11,607.62 and the S&P 500 jumped 116.01 points or 3.06 percent to close at 3,911.74.

For the holiday-shortened week, the NASDAQ soared by 7.5 percent, while the S&P 500 and the Dow spiked by 6.4 percent and 5.4 percent, respectively.

Traders continue to express concerns about inflation, interest rates and a potential recession but may feel to sell-off earlier this month was overdone.

On the U.S. economic front, the Commerce Department unexpectedly reported a significant rebound in new home sales in May. Also, the University of Michigan said consumer sentiment in the U.S. tumbled more than expected in June.

Crude oil prices rose sharply on Friday on optimism for continued high demand for energy and tight supply. West Texas Intermediate Crude oil futures for August ended higher by $3.35 or 3.2 percent at $107.62 a barrel. WTI futures shed 1.8 percent in the week.

Closer to home, China will on Monday release May figures for industrial profits later today; in April, profits were down 8.6 percent on month and up 3.5 percent on year.