RTTNews - The China stock market headed right back to the upside again on Monday, one session after ending the modes two-day winning streak in which it had collected 100 points or 3 percent. The Shanghai Composite Index has broken through the 3,250-point plateau and now sits at a 13-month closing high, and investors are looking for more gains in Tuesday's trade.
The global forecast for the Asian markets is optimistic as bourses around the world continue to be buoyed by solid corporate earnings news. Commodities are tipped to extend their rebound after suffering through much of last week, while the airlines and properties also are due to rise. The European and U.S. markets all finished firmly in positive territory, and the Asian markets are projected to follow that lead.
The SCI finished sharply higher on Monday, thanks to a continued rebound in the price of commodities. Properties were a key drag on the index.
For the day, the index surged 77 points or 2.42 percent to close at 3,266.92 after trading between 3,192.90 and 3,269.18. The Shenzhen Index was up 249 points or 1.9 percent to close at 13,381 points for a combined turnover of 350 billion yuan.
Among the gainers, Shanxi Antai Group, Shanxi Coking, Jiangsu Alcha Aluminium, Aluminum Corp. of China (Chalco) and Yanzhou Coal Mining all advanced by the 10 percent daily limit, while Jiangxi Copper added 7.2 percent and China Shenhua Energy rose 4.1 percent. Finishing lower, Sunshine City Group and China Vanke both fell by the 5 percent daily limit.
The lead from Wall Street continues to be broadly positive as stocks posted strong gains on Monday, boosted by promising earnings results and reassuring news from commercial lending giant CIT Group (CIT). The major averages kicked off the week on a positive note, finishing in positive territory by solid margins.
In earnings news, Halliburton Co. (HAL), M&T Bank Corp. (MTB), Hasbro (HAS), Eaton (ETN) and Johnson Controls (JCI) all reported quarterly results that largely exceeded Wall Street expectations, bolstering trader optimism. This morning, some trader concern regarding the bankruptcy of CIT Group was alleviated, as the lending giant reportedly secured $3 billion in financing from some of its largest bondholders.
On the economic front today, the Conference Board released a report showing that its index of leading economic indicators increased by more than expected in June, although both the coincident index and lagging index continued to decline. The report showed that the leading indicators index increased by 0.7 percent in June following an upwardly revised 1.3 percent increase in May. Economists had expected the index to increase by 0.5 percent compared to the 1.2 percent increase originally reported for the previous month.
In other news, Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, predicted modest growth starting in the second half of the year, though he said there is not likely to be a strong recovery in the medium term.
The major averages saw further upside heading into the close, finishing near their best levels of the day. The Dow advanced by 104.21 points or 1.2 percent to 8,848.15, the NASDAQ climbed by 22.68 points or 1.2 percent to 1,909.29 and the S&P 500 rose by 10.74 points or 1.1 percent to 951.13.
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