Continued Consolidation Called For China Bourse

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(RTTNews) – The China stock market on Wednesday snapped the three-day winning streak in which it had surged more than 140 points or 4.4 percent. The Shanghai Composite Index now sits just above the 3,340-point plateau and it’s tipped to open lower again on Thursday.

The global forecast for the Asian markets is negative on rising coronavirus cases and fading optimism for stimulus. The European and U.S. markets were down and the Asian bourses are expected to open in similar fashion.

The SCI finished modestly lower on Wednesday following losses from the property stocks and oil companies, while the financials were mixed.

For the day, the index slid 18.97 points or 0.56 percent to finish at 3,340.78 after trading between 3,332.96 and 3,353.62. The Shenzhen Composite Index lost 13.79 points or 0.60 percent to end at 2,290.40.

Among the actives, Bank of China fell 0.31 percent, while China Merchants Bank collected 0.69 percent, Bank of Communications shed 0.44 percent, China Life Insurance was up 0.02 percent, PetroChina dropped 0.96 percent, China Petroleum and Chemical (Sinopec) lost 0.51 percent, China Shenhua Energy sank 0.77 percent, Gemdale plummeted 2.88 percent, Poly Developments slid 0.56 percent, China Vanke retreated 0.75 percent and Ping An Insurance, Industrial and Commercial Bank of China and China Construction Bank were unchanged.

The lead from Wall Street is soft as stocks moved mostly lower on Wednesday, extending losses from the previous session.

The Dow shed 165.81 points or 0.58 percent to finish at 28,514.00, while the NASDAQ dropped 95.17 points or 0.80 percent to end at 11,768.73 and the S&P 500 fell 23.26 points or 0.66 percent to close at 3,488.67.

The weakness on Wall Street followed comments from Treasury Secretary Steven Mnuchin, which offset recent optimism about a new stimulus bill. He said getting something done on a new stimulus bill before the election “would be difficult.”

A negative reaction to the latest batch of earnings news also weighed, with Bank of America (BAC) shares falling sharply after the financial giant reported Q3 earnings that beat estimates but missed on revenues. Wells Fargo (WFC) and UnitedHealth (UNH) also were key drags.

Crude oil prices moved higher Wednesday despite concerns about the energy demand outlook amid a continued surge in coronavirus cases and fresh lockdown restrictions. West Texas Intermediate Crude oil futures for November ended up $0.84 or 2.1 percent at $41.04 a barrel.

Closer to home, China will provide September numbers for consumer and producer prices later this morning. Consumer prices are tipped to add 0.3 percent on month and 1.8 percent on year – slowing from 0.4 percent on month and 2.4 percent on year in August. Producer prices are called lower by an annual 1.8 percent after sinking 2.0 percent a month earlier.

A Global Asset Management Seoul Korea Magazine

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