China Stock Market May Run Out Of Steam On Tuesday

The China stock market has moved higher in two straight trading days, gathering more than 60 points or 0.8 percent along the way. The Shanghai Composite Index now rests just above the 3,580-point plateau although it may spin its wheels on Tuesday.

The global forecast for the Asian markets is mixed to lower, with technology stocks expected to weigh - although support from crude oil prices should limit the downside. The European and U.S. markets were mixed and the Asian bourses figure to follow suit.

The SCI finished modestly higher on Monday following mixed performances from the resource stocks and energy producers.

For the day, the index gained 21.71 points or 0.61 percent to finish at 3,582.08 after trading between 3,562.75 and 3,585.19. The Shenzhen Composite Index jumped 35.31 points or 1.42 percent to end at 2,525.58.

Among the actives, Industrial and Commercial Bank of China shed 0.64 percent, while China Construction Bank lost 0.51 percent, China Merchants Bank retreated 1.22 percent, Bank of Communications fell 0.43 percent, China Minsheng Bank sank 0.51 percent, China Life Insurance eased 0.14 percent, Jiangxi Copper slid 0.30 percent, Aluminum Corp of China (Chalco) dipped 0.37 percent, Yanzhou Coal climbed 1.14 percent, PetroChina added 0.41 percent, China Petroleum and Chemical (Sinopec) skidded 1.20 percent, Huaneng Power declined 1.68 percent, China Shenhua Energy rose 0.16 percent, Gemdale plummeted 6.44 percent, Poly Developments plunged 6.06 percent, China Vanke tanked 3.42 percent, China Fortune Land tumbled 3.10 percent and Bank of China was unchanged.

The lead from Wall Street is not encouraging as the major averages opened higher on Monday but tumbled late in the day, with only the Dow managing to barely hang on to positive territory.

The Dow rose 17.27 points or 0.05 percent to finish at 35,619.25, while the NASDAQ plunged 202.68 points or 1.26 percent to close at 15,854.76 and the S&P fell 15.02 points or 0.32 percent to end at 4,682.94.

The mixed close on Wall Street came after President Joe Biden announced his intent to nominate Jerome Powell for a second term as Federal Reserve Chair. The White House also revealed that Biden intends to nominate current Fed Governor Lael Brainard as Vice Chair of the Federal Reserve System.

While the re-nomination of Powell will give the Fed stability as it grapples with the economic recovery and elevated inflation, Brainard was seen as the more dovish choice.

Crude oil futures settled higher Monday despite rising concerns about the outlook for energy demand due to a surge in coronavirus cases in several countries. West Texas Intermediate Crude oil futures for December rose $0.81 or 1.1 percent at $76.75 a barrel.

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