RTTNews - The China stock market has finished higher now in three straight sessions, surging nearly 160 points or 4.5 percent on its way to a fresh 13-monthy closing high. The Shanghai Composite Index closed above the 3,370-point plateau, and now investors are optimistic that the market could test the 3,400-point barrier at the opening of trade on Monday.
The global forecast for the Asian markets provide little guidance as expected declines among the financials and technology sectors could be offset by gains among health care and pharmaceutical stocks. The markets in Europe and the United States finished mixed on Friday, but not too far from the unchanged line one way or the other. The Asian bourses could open to the upside once again, although a mild downside correction could take hold later in the day for many of the markets that are riding significant winning streaks.
The SCI finished sharply higher on Friday, fueled by commodity stocks. Tourism and shipping stocks also finished higher, although the gains were tempered by weakness among the financials and properties.
For the day, the index gained 44.11 points or 1.33 percent to close at 3,372.6 after trading between 3,398.05 and 3,306.91. The Shenzhen Index was up 10.07 points or 0.07 percent to close at 13,531.72 points for a combined turnover of 337.8 billion yuan. Decliners in Shanghai outnumbered gainers 552 to 261, while 41 were unchanged.
Among the gainers, LiJiang YuLong Tourism, Aluminum Corp of China and Yunnan Copper all were up by the daily limit of 10 percent, while PetroChina gained 5.41 percent, Sinopec rose 3.48 percent, China Coal Energy Co jumped 6.57 percent, China Shenhua Energy surged 6.23 percent, CSSC Jiangnan Heavy Industry added 6.40 percent, Guangzhou Shipyard International Co gained 3.46 percent, Changjiang Securities was up 1.16 percent and CITIC Securities collected 0.49 percent.
Finishing lower, Shenzhen Development Bank fell 1.99 percent, while Industrial and Commercial Bank of China eased 0.76 percent, China Vanke shed 1.39 percent and Poly Real Estate Group dropped 2.01 percent.
The lead from Wall Street is mixed as stocks were able to regain some ground but still finished Friday's session on a mixed note after discouraging news from Microsoft (MSFT) prompted a lower open. The Dow and the S&P 500 were able to eke out modest gains, while the NASDAQ snapped a 12-day wining streak.
Earlier selling pressure was generated by disappointing earnings from Microsoft, which reported weaker than expected quarterly sales, while American Express (AXP), Amazon.com (AMZN), Black & Decker (BDK), Schlumberger (SLB) and others offered a mixed bag of results.
Traders largely shrugged off a mixed report from Reuters and the University of Michigan, which showed that their reading on consumer sentiment for the month of July was upwardly revised from the preliminary reading but still came in well below the previous month. The report said that the consumer sentiment index for July came in at 66.0 compared to the preliminary reading of 64.6, although it remained below a reading of 70.8 for June. Economists had expected the index to be revised up to 65.0.
Meanwhile, some traders looked to Capitol Hill, where Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke were among government officials testifying before the House Financial Services Committee regarding financial service regulatory reform. Notably, the Fed chief indicated that the government is winding down its unprecedented intervention in the U.S. financial system.
The major averages eventually ended the session on opposite sides of the unchanged line, with the NASDAQ stuck in the red. While the NASDAQ slipped by 7.64 points or 0.4 percent to 1,965.96, the Dow climbed 23.95 points or 0.3 percent to 9,093.24 and the S&P 500 rose by 2.97 points or 0.3 points to 979.26. Despite the mixed performance for the session, the major averages all posted strong gains for the week. The Dow rose 4 percent for the week, while the NASDAQ and the S&P 500 posted weekly gains of 4.2 percent and 4.1 percent, respectively.
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