News Column

China Stock Market Draws Mild Support On Monday

June 22, 2014

BEIJING (dpa-AFX) - The China stock market on Friday snapped the three-day losing streak in which it had surrendered almost 65 points or 3.1 percent. The Shanghai Composite Index settled just above the 2,025-point plateau, although the market may tick slightly higher again on Monday.

The global forecast for the Asian markets suggests little movement due to the absence of major catalysts ahead of key economic data later this week. The European markets were mixed and the U.S. bourses were slightly higher, and the Asian markets figure to split the difference.

The SCI finished slightly higher on Friday, nudged into the green by bargain hunting among the property stocks.

For the day, the index collected 2.94 points or 0.15 percent to finish at 2,026.67 after trading between 2,010.53 and 2,027.15 on turnover of 53.22 billion yuan.

The Shenzhen Component Index gained 15.37 points or 0.21 percent to finish at 7,195.69 on turnover of 73.82 billion yuan.

Among the gainers, China Vanke spiked 1.8 percent and Gemdale surged 4.2 percent.

The lead from Wall Street is mildly positive as stocks inched higher on Friday after ending the previous session nearly flat. While buying interest remained subdued, the Dow and the S&P 500 both reached new record closing highs.

The Dow ticked up 25.62 points or 0.2 percent to 16,947.08, while the NASDAQ edged up 8.71 points or 0.2 percent to 4,368.04 and the S&P 500 crept up 3.39 points or 0.2 percent at 1,962.87. For the week, the Dow advanced 1 percent, while the NASDAQ and the S&P 500 jumped by 1.3 percent and 1.4 percent, respectively.

The absence of U.S. economic news led to light trading activity as investors looked ahead to some key data due to be released next week. This week's data includes closely watched reports on new and existing home sales, durable goods orders, and personal income and spending.

The personal income and spending report includes a reading on inflation that is favored by the Federal Reserve and is likely to be in focus in light of recent reports showing notable price growth.

Despite the recent indications of rising prices, the Fed said inflation has been running below the monetary policy committee's longer-run objective.

Ongoing geopolitical concerns in Iraq also may keep traders on the sidelines.

Later today, China will on Monday see preliminary results for its manufacturing PMI from HSBC. In May, the index saw a final score of 49.4, just below the boom-or-bust line of 50 that separates expansion from contraction.

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Source: dpa-AFX International Compact

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