The China stock market has closed higher now in three straight sessions, collecting more than 55 points or 2.3 percent en route to a fresh two-month closing high. The Shanghai Composite finished just above the 2,450-point plateau, although now traders are bracing for a sharp correction to the downside when the market opens on Monday.
The global forecast for the Asian markets is grim following disappointing employment data from the United States, while Eurozone private sector activity declined in April at the fastest rate since October 2011. In addition, Germany's services sector grew less than expected in April, and the French service sector contracted. Adding to the uncertainty, Francois Hollande was crowned the new President of France beating Nicholas Sarkozy. The European and U.S. markets were down, and the Asian bourses are tipped to follow suit.
The SCI finished modestly higher on Friday following gains from the property stocks and financial shares.
For the day, the index climbed 11.93 points or 0.49 percent to finish at 2,452.01 after trading between 2,427.97 and 2,453.73. The Shenzhen Composite jumped 10.31 points or 1.1 percent to end at 972.30.
Among the gainers, Industrial and Commercial Bank of China added 0.7 percent, while China Construction Bank collected 0.6 percent, China Vanke jumped 2 percent, Poly Real Estate gathered 0.5 percent, Dongjiang Environment surged 4.4 percent and Eguard Resources Development spiked 3.8 percent.
The lead from Wall Street is negative as stocks moved sharply lower on Friday as disappointing jobs data generating broad based selling pressure as the Labor Department reported much weaker than expected job growth in April.
Employment increased by 115,000 jobs in April compared to expectations for an increase of about 165,000 jobs. While the Labor Department also said that the unemployment rate edged down to 8.1 percent in April from 8.2 percent in March, the drop was largely due to a decrease in the size of the labor force.
Among individual stocks, shares of Qlogic (QLGC) fell 9.5 percent after the storage-networking technology company reported better than expected fourth quarter earnings but on weaker than expected revenues. Kraft (KFT) also ended the day in the red even though the food giant reported better than expected first quarter results.
Meanwhile, shares of LinkedIn (LNKD) jumped 7.2 percent after the online professional network operator reported first quarter results that exceeded estimates and provided upbeat guidance.
In other news, Facebook set the price range for its initial public offering at $28 to $35 per share. The social networking giant expects the much anticipated IPO to raise up to $13.6 billion and give the company a market value as high as $96 billion.
After moving sharply lower in morning trade, the major averages remained firmly negative throughout the afternoon. The Dow slid 168.32 points or 1.3 percent to finish at 13,038.27, while the NASDAQ plunged 67.96 points or 2.3 percent to end at 2,956.34 and the S&P 500 fell 22.47 points or 1.6 percent to 1,369.10. The losses resulted in steep losses for the week. The Dow fell by 1.4 percent, while the NASDAQ tumbled by 3.7 percent and the S&P 500 dropped by 2.4 percent.
In economic news, the Chinese service sector expanded at the fastest pace in six months in April, easing concerns over the slowdown of the world's second largest economy amid poor manufacturing performance.
The headline HSBC business activity index rose to a six-month high of 54.1 in April from 53.3 in March. The index reading above 50 indicates expansion of the sector and a reading below 50 suggests contraction. The improvement was supported by the growth in new orders, which was the strongest in ten months.
The composite output index, that measures performance of both manufacturing and service sectors, rose to 51.4 from 49.9 in the preceding month. The data pointed to the strongest expansion of private sector new business since October 2011.
by RTT Staff Writer
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