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China Bourse Predicted To Open In The Red

Ahead of the long holiday weekend for the Dragon Boat Festival, the China stock market had moved higher in back-to-back trading days, gathering almost 15 points or 0.5 percent along the way. The Shanghai Composite Index new rests just shy of the 2,980-point plateau although it figures to catch up on negative sentiment on Monday.

The global forecast for the Asian markets is soft on spiking Covid-19 cases and poor results from bank stress tests. The European markets were mixed and the U.S. bourses were sharply lower and the Asian markets figure to follow the latter lead.

The SCI finished slightly higher on Wednesday following gains from the financial shares, property stocks and insurance companies.

For the day, the index added 8.93 points or 0.30 percent to finish at 2,979.55 after trading between 2,971.22 and 2,982.94. The Shenzhen Composite Index rose 0.28 points to end at 1,947.73.

Among the actives, Industrial and Commercial Bank of China jumped 1.56 percent, while Bank of China collected 0.58 percent, China Construction Bank advanced 0.80 percent, China Merchants Bank spiked 1.65 percent, China Life Insurance rallied 2.10 percent, Ping An Insurance added 0.42 percent, China Shenhua Energy rose 0.20 percent, Gemdale soared 2.83 percent, Poly Developments surged 3.00 percent, China Vanke skyrocketed 3.33 percent and PetroChina and China Petroleum and Chemical (Sinopec) were unchanged.

The lead from Wall Street is broadly negative as stocks opened sharply lower on Friday and stayed that way throughout the session.

The Dow plummeted 730.05 points or 2.84 percent to finish at 25,015.55, while the NASDAQ tumbled 259.78 points or 2.59 percent to end at 9,757.22 and the S&P 500 sank 74.71 points or 2.42 percent to close at 3,009.05.

The weakness on Wall Street was due largely to a sharp surge in new Covid-19 infections in several states, raising fears of re-imposing restrictions on businesses. The U.S. Centers of Disease Control and Prevention has warned that the number of infected people in the U.S. is most likely 10 times higher than what has been officially reported.

Financials turned lower after the Fed released the results of stress tests on banks - which said the nation's biggest banks are healthy but could suffer up to $700 billion in losses on soured loans if the economy languishes. It also ordered certain banks to cap dividends to conserve funds.

Crude oil futures settled lower on Friday, weighed down by concerns over energy demand outlook in the wake of sharp spikes in new coronavirus infections in several states in the U.S. West Texas Intermediate Crude oil futures for August ended down $0.23 or 0.6 percent at $38.49 a barrel.

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