The China stock market moved right back to the upside again on Tuesday, one session after it had ended the two-game winning streak in which it had collected more than 40 points or 2.7 percent. The Shanghai Composite Index finished just above the 2,455-point plateau, and now investors are looking for further upside when the market opens on Wednesday.
The global forecast for the Asian markets is broadly upbeat in a positive reaction to U.S. retail sales data, as well as the Federal Reserve's monetary policy announcement. Also positive is news that European finance ministers approved a second bailout for Greece worth 130 billion euros. Financials are expected to provide support, along with properties and steel companies. The European and U.S. markets finished firmly higher and the Asian markets are expected to follow suit.
The SCI finished modestly higher on Tuesday following gains from the coal miners and property stocks.
For the day, the index gathered 20.93 points or 0.86 percent to finish at 2,455.79 after trading between 2,428.61 and 2,457.22. The Shenzhen Composite Index jumped 10.83 points or 1.1 percent to end at 1,010.46.
Among the gainers, Henan Shenhuo Coal climbed 1.5 percent, while China Shenhua Energy jumped 1.4 percent, Shanghai Datun Energy Resources added 1.0 percent, China Vanke collected 2.0 percent, Yihua Real Estate gathered 2.3 percent and Huayuan Property surged 5.2 percent to CNY4.22.
The lead from Wall Street is firmly positive as stocks moved sharply higher on Tuesday, breaking out of a recent trading range. The markets benefited from a positive reaction to U.S. retail sales data as well as the Federal Reserve's monetary policy announcement.
The rally was sparked by a report from the Commerce Department showing that U.S. retail sales rose by 1.1 percent in February following an upwardly revised 0.6 percent gain in January - in line with forecasts and marking the fastest pace since September. Excluding a 1.6 percent increase in auto sales, sales rose by 0.9 percent in February following a 1.1 percent gain in January.
Stocks accelerated following the Fed's monetary policy announcement, which noted that information received since its January meeting suggests moderate economic expansion - which it expects to continue over the coming quarters, adding that the unemployment rate will decline gradually. While the Fed also reiterated that economic conditions are likely to warrant exceptionally low rates at least through late 2014, there was no hint of quantitative easing.
The markets also benefited from news that European finance ministers approved a second bailout for Greece worth 130 billion euros.
Among individual stocks, shares of Nautilus (NLS) surged 10.2 percent after the fitness products company reported fourth quarter income from continuing operations of $0.11 per share compared to $0.06 per share last year. Meanwhile, Urban Outfitters (URBN) declined after the apparel retailer reported disappointing Q4 results, with shares falling 5.3 percent.
The major averages saw further upside going into the close, ending the session at or near their highs for the day. The Dow jumped 217.97 points or 1.7 percent to finish at 13,177.68, while the NASDAQ added 56.22 points or 0.2 percent to 3,039.88 and the S&P 500 soared 24.87 points or 1.8 percent to end at 1,395.96. With the gains, the NASDAQ reached an eleven-year high, while the Dow reached a four-year high and the S&P 500 reached a three-year high.
by RTT Staff Writer
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