China Bourse Likely To Erase Wednesday's Gains

(RTTNews) - The China stock market ticked higher again on Wednesday, one day after ending the three-day winning streak in which it had climbed more than 50 points or 1.8 percent. The Shanghai Composite Index now sits just beneath the 3,160-point plateau although it's tipped to find renewed selling pressure on Thursday.

The global forecast for the Asian markets is negative on a dimming outlook for interest rates. The European and U.S. markets were down and the Asian markets are expected to open in similar fashion.

The SCI finished barely higher on Wednesday as gains from the properties and financials were offset by weakness from the resource companies.

For the day, the index perked 0.57 points or 0.02 percent to finish at 3,158.54 after trading between 3,152.46 and 3,166.92. The Shenzhen Composite Index added 4.19 points or 0.24 percent to end at 1,784.69.

Among the actives, Industrial and Commercial Bank of China perked 0.18 percent, while Bank of China added 0.44 percent, China Construction Bank rose 0.28 percent, China Merchants Bank shed 0.50 percent, Bank of Communications collected 0.71 percent, China Life Insurance skidded 1.11 percent, Jiangxi Copper tumbled 1.83 percent, Aluminum Corp of China (Chalco) retreated 1.86 percent, Yankuang Energy was up 0.04 percent, PetroChina sank 0.79 percent, China Petroleum and Chemical (Sinopec) improved 0.79 percent, Huaneng Power gathered 0.22 percent, China Shenhua Energy lost 0.55 percent, Gemdale skyrocketed 6.34 percent, Poly Developments gained 0.80 percent and China Vanke rallied 2.29 percent.

The lead from Wall Street is soft as the major averages spent the first half of Wednesday hugging the line before stumbling into the red late in the day.

The Dow tumbled 201.95 points or 0.51 percent to finish at 39,671.04, while the NASDAQ dropped 31.08 points or 0.18 percent to close at 16,801.54 and the S&P 500 fell 14.40 points or 0.27 percent to end at 5,307.01.

The weakness that emerged on Wall Street came as the Fed minutes suggested officials expect to maintain interest rates at current levels longer than previously thought.

The minutes of the April 30-May 1 meeting said participants highlighted disappointing readings on inflation over the first quarter and indicators pointing to strong economic momentum.

While officials also discussed reducing policy restraint in the event of an unexpected weakening in labor market conditions, participants also noted a willingness to raise rates further of necessary should risks to inflation materialize.

Oil prices fell to a two-month low on Wednesday after data showed an unexpected rebound in crude oil inventories in the U.S. last week. West Texas Intermediate crude oil futures for July ended down by $1.09 or 1.4 percent at $77.57 a barrel.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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