News Column

Rally May Stall For China Stock Market

August 31, 2014

BEIJING (dpa-AFX) - The China stock market has moved higher in two of three trading days since the end of the two-day slide in which it had retreated almost 35 points or 1.5 percent. The Shanghai Composite Index ended just above the 2,215-point plateau, although the market may hand back some of those gains on Monday.

The global forecast for the Asian markets remains murky thanks to ongoing geopolitical concerns in Ukraine, plus softer than expected economic data from the United States. The European and U.S. markets were slightly higher, and the Asian markets now look flat to higher.

The SCI finished sharply higher on Friday, following solid gains from the technology stocks.

For the day, the index advanced 21.38 points or 2,193.26 to finish at the daily high of 2,218.70 after trading as low as 2,193.26 on turnover of 93.0 billion yuan. The Shenzhen Composite Index surged 13.55 points or 1.13 percent to end at 1,212.26 on turnover of 107.6 billion yuan.

Among the actives, China Avic Electronics surged by the 10 percent daily limit, while Sichuan Chengfei Integration Technology soared 7.5 percent.

The lead from Wall Street is cautiously optimistic as stocks ended another strong week on a high note, with the S&P 500 setting all-time highs above the 2,000 milestone.

The S&P 500 rose 6.57 points, or 0.33 percent, to a record 2,003.32,00. The Dow gained 18.75 points or 0.1 percent to end at 17,098.32, while the NASDAQ added 22.58 points or 0.5 percent to 4,580.27.

It was the best monthly gains for stocks since February, and the best August in fourteen years.

In economic news, consumers spent less in July than in the previous month, a surprise retreat that complicates the prevailing belief that the U.S. economic situation is improving.

Also, manufacturing activity in the Chicago-area rebounded in August, as factories reported increases in new orders.

Later today, China will on Monday see August results for the government's official manufacturing purchasing managers' index. The PMI is expected to show a score of 51.3, down from 51.7 in July. Also due are final August results from the HSBC manufacturing PMI for China; the index is expected to come in at 50.5.

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Source: dpa-AFX International Compact

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