RTTNews - The Chinese stock market has finished lower now in back-to-back sessions since ending the four-day winning streak in which it had collected nearly 190 points or 7 percent on its way to a fresh 10-month closing high. The Shanghai Composite Index is clinging to support at the 2,750-point plateau, although investors are not sanguine about the market's ability to hold that line at the opening of trade on Monday.
The global forecast for the Asian markets offers little guidance, although the markets may slip under mild selling pressure on some overdue profit taking. Some better than expected economic news out of the United States is likely to keep the decline in the modest range. The European markets finished Friday's session in the green, while the U.S. markets ended little changed with a slight negative bias - and the Asian markets are projected to also move a bit lower.
The SCI finished modestly lower on Friday, dragged to the downside by the financials - although the losses were mitigated somewhat by support from the resource and shipbuilding sectors.
For the day, the index shed 13.35 points or 0.5 percent to close at 2,753.89 after trading between 2,750.38 and 2,791.65. The Shenzhen Composite Index was down 0.4 percent to 917.21.
Among the decliners, Beijing Shougang fell 3.3 percent, while China Merchants Bank dropped 1.4 percent, Bank of China eased 0.8 percent, China Construction Bank fell 1.2 percent and China Vanke lost 1.6 percent.
Finishing higher, Shandong Gold Mining rose 7.7 percent, while Jiangxi Copper was up 1.0 percent, Aluminum Corp. of China (Chinalco) was up 0.7 percent and China CSSC Holdings Ltd. advanced 2.3 percent.
The lead from Wall Street is flat with a touch of downside as stocks finished Friday's trading mostly lower after a lackluster performance following strong gains in the previous session. The major averages ended the day on opposite sides of the unchanged line, as traders were cautious following an employment report indicative of some signs of life in the labor market.
The report from Labor Department showed that non-farm payroll employment fell by 345,000 jobs in May following a revised decrease of 504,000 jobs in April. Economists had expected a decrease of about 520,000 jobs compared to the loss of 539,000 jobs originally reported for the previous month. At the same time, the report said that the unemployment rate jumped to 9.4 percent in May from 8.9 percent in April. With the increase, the unemployment rate came in above economist estimates of 9.2 percent and rose to its highest level since August of 1983.
On the corporate front, shares of Anglo-Australian mining giant Rio Tinto (RTP) rose after the company entered into a joint venture agreement with rival BHP Billiton and scrapped its $19.5 billion deal with Chinalco. In lieu of its deal with Chinalco, Rio Tinto instead launched a heavily discounted $15.2 billion rights issue. The company also reported a decline in fiscal 2009 first-quarter earnings, adversely impacted by price movements and production volumes amid the downturn in economy.
Meanwhile, international retailer Guess (GES) said its first quarter profit fell 32 percent from last year, as revenue dropped and margins shrank. However, the company's quarterly earnings per share beat analysts' expectations. The firm's shares closed up by 5.8 percent for the day.
The major averages eventually finished the day mixed after being marred by choppy trading throughout the session. While the Dow finished up by 12.89 points of 0.2 percent at 8,763.13, the NASDAQ slipped by 0.60 points or less than a tenth of a percent to 1,849.42 and the S&P 500 edged down by 2.37 points or 0.3 percent to 940.09. For the week, the major averages all enjoyed notable gains despite being slowed by lackluster sessions on Wednesday and Friday. The Dow moved up by 3.1 percent for the week, while the NASDAQ rose by 4.2 percent and the S&P 500 climbed by 2.3 percent.
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