RTTNews - The Hong Kong stock market has finished higher now in back-to-back sessions, jumping nearly 1,200 points or 6.4 percent on its way to an eight-month closing high. The Hang Seng Index broke through resistance at 18,000 points, and now investors are hopeful that the market will add to those gains at the opening of trade on Monday.

The global forecast for the Asian markets is optimistic thanks to positive economic and corporate releases at the end of last week. U.S. auto giant General Motors is expected to declare bankruptcy on Monday, although it has already been priced in by many of the markets - and it may affect auto stocks throughout the region. The European markets were mostly higher on Friday, and the U.S. bourses were sharply up - and the Asian markets are forecast to move higher as well.

The Hang Seng finished sharply higher again on Friday, after returning to action following Thursday's market holiday for the Dragon Boat Festival. The financials led the gainers, while the oil companies also ended higher.

For the day, the index jumped 285.73 points or 1.60 percent to finish at 18,171.00 after trading between 17,833.74 and 18,227.79 on turnover of 92.17 billion Hong Kong dollars.

Among the gainers, Bank of China rose 7.7 percent, while CNOOC rose 4.19 percent, PetroChina jumped 2.07 percent, BOC Hong Kong jumped 11 percent and Ping An Insurance was 5.2 percent higher.

The lead from Wall Street is broadly positive as stocks saw some further upside over the course of the trading day on Friday after a considerable upward move in the previous session. A late-session rally helped the major averages to finish the month of May on a high note, further building on recent gains.

Early this morning, traders digested a revised May consumer sentiment report from Reuters and the University of Michigan that showed its best results in eight months. The revised reading came in at 68.7, higher than the previously reported reading of 67.9. The result was also higher than April's final level of 65.1. Analysts expected the survey to yield a reading of 68.0.

Separately, the Commerce Department said that gross domestic product for the first quarter contracted, although at a slower rate than previously estimated. Specifically, the data said that gross domestic product fell 5.7 percent in the first quarter compared to the advance estimate of a 6.1 percent decrease. Economists had been expecting the pace of contraction to be revised to 5.5 percent.

Meanwhile, optimism was limited by manufacturing data from the Chicago area that continued to show a notable slowdown in the region. The ISM-Chicago said its index of activity in the manufacturing sector fell to 34.9 in May from 40.1 in April, with a reading below 50 indicating a contraction. Economists expected the index to edge up to a reading of 42.0.

On the corporate front, automaker General Motors (GM) plans to file for bankruptcy protection on Monday, according to reports. Most of the company's assets would be sold to a new company sponsored by the U.S. Treasury Department. UAW-represented employees have ratified modifications to the GM-UAW 2007 national labor agreement. The amended agreement covers about 54,000 hourly employees located in 46 U.S. facilities and is expected to help GM restructure when it enters bankruptcy.

In other news, President Barack Obama announced the establishment of a cyber security office. The new office is expected to establish a system that will restrict outside access to government networks, which have been identified as an area of concern by the administration. In addition to announcing the new office, Obama also stated his goal for a new education initiative aimed at increasing awareness of cyber security threats.

The major averages soared in the last 30 minutes of trading, closing near their best levels of the day. The Dow closed up 96.53 points or 1.2 percent at 8500.33, the NASDAQ closed up 22.54 points or 1.3 percent at 1774.33, and the S&P 500 finished up 12.31 points or 1.4 percent at 919.14. The gains helped the major averages close higher for both the week and the month of May. The Dow rose 4.1 percent for the month, adding to the gains posted in both March and April. The NASDAQ and the S&P 500 posted monthly gains of 3.3 percent and 5.3 percent, respectively.

In economic news, Hong Kong will on Monday announce April numbers for retail sales. By value, sales are seen down 6.5 percent on year after the 7.7 percent contraction in March. By volume, sales are expected lower by 7.2 percent on year following the 9.3 percent annual decline in the previous month.

Also, the purchasing managers' index in Hong Kong came in at an index score of 44.8 in May, statistics compiler Markit Group said on Monday - up from 44.3 in April. The PMI remains below the boom-or-bust score of 50, which signals contraction. A score above 50 represents expansion. The survey is based on responses from 300 companies and incorporates changes in employment, purchases and output.

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