Plus   Neg

China Stock Market May Open Under Pressure

The China stock market turned lower again on Wednesday, one session after it had halted the three-day slide in which it had fallen almost 65 points or 2.1 percent. The Shanghai Composite Index now rests just beneath the 3,050-point plateau and it may open in the red again on Thursday.

The global forecast for the Asian markets is negative thanks to renewed concern over the outlook for interest rates. The European and U.S. markets were down and the Asian bourses figure to follow that lead.

The SCI finished modestly lower on Wednesday following losses from the financials and mixed performances from the oil and insurance companies.

For the day, the index dropped 30.00 points or 0.97 percent to finish at 3,049.80 after trading between 3,044.12 and 3,071.46. The Shenzhen Composite Index tumbled 27.73 points or 1.58 percent to end at 1,731.43.

Among the actives, China Construction Bank and Agricultural Bank of China both shed 0.28 percent, while Industrial and Commercial Bank of China lost 0.36 percent, China Merchants Bank eased 0.10 percent, Bank of China fell 0.27 percent, Ping An Insurance slid 0.23 percent, China Life added 0.16 percent, CITIC Securities tumbled 1.43 percent, China Petroleum and Chemical (Sinopec) climbed 0.93 percent, PetroChina retreated 0.64 percent, China Shenhua Energy skidded 0.95 percent, China Vanke dipped 0.25 percent and Bank of Communications was unchanged.

The lead from Wall Street is soft as stocks saw modest strength for much of Wednesday but came under pressure following the Federal Reserve's monetary policy announcement.

The Dow slid 119.53 points or 0.47 percent to 25,201.20, while the NASDAQ eased 8.09 points or 0.11 percent to 7,695.70 and the S&P 500 fell 11.22 points or 0.40 percent to 2,775.63.

The pullback came after the Fed announced its decision to raise interest rates by 25 basis points to a range of 1.75 to 2 percent. The rate hike was widely expected, but the Fed surprised investors by forecasting two additional rate hikes this year after previously predicting only one rate.

The central bank said data received since its May meeting indicates that the labor market has continued to strengthen and that economic activity has been rising at a solid rate.

In economic news, the Labor Department noted a bigger than expected increase in producer prices in May - while core producer prices also ticked higher.

Crude oil futures rose Wednesday after energy inventories fell more than forecast. July WTI oil climbed 28 cents or 0.4 percent to settle at $66.64/bbl.

Closer to home, China will release May figures for retail sales, industrial production and fixed asset investment later this morning. Retail sales are expected to climb 9.6 percent on year, up from 9.4 percent in April. Industrial production is called steady at an annual 9.7 percent, while FAI is seen as unchanged at 7.0 percent.

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