The China stock market has finished lower now in two of the last three sessions, but still maintained support at 1,700 points in the process. But now analysts say that the Shanghai Composite Index could bounce back on Monday thanks to positive global cues - perhaps testing the 1,800-point plateau.
The global forecast is fairly optimistic as more central banks around the world are expected to follow through with additional interest rate cuts after a series of cuts last week that returned some confidence to investors. Also, many of the Asian bourses have plummeted in recent weeks, and investors are starting to snap up stocks at a discount. Finally, the Asian markets see a rare optimistic lead from Wall Street, and are forecast to follow suit.
The SCI finished sharply lower on Friday, dragged to the downside by heavy losses in the financial, transportation and energy sectors. For the day, the index dropped 34.82 points or 1.97 percent to close at 1,728.79 after trading between 1,721.59 and 1,765.68.
Among the decliners, Daqin Railway was down 10 percent, while Shenzhen Airport lost 10.0 percent, Air China dropped 4.4 percent, China Eastern Airlines lost 5.8 percent, China Southern Airlines slid 3.4 percent, Hainan Airlines fell 5.0 percent, Shanghai Airlines plummeted 6.2 percent, Kailuan Clean Coal plunged 7.2 percent, Bank of Communications plunged 4.2 percent, China CITIC Bank lost 1.0 percent, Industrial Bank fell 2.7 percent, China Merchants Bank shed 3.9 percent, China Minsheng Banking Corp declined 1.7 percent, Bank of China slipped 0.3 percent, China Life Insurance gave away 4.2 percent, Ping An Insurance slid 2.9 percent, PetroChina declined 2.1 percent and Sinopec plummeted 4.3 percent.
Wall Street provides a positive lead as stocks staged a substantial turnaround over the course of the trading day on Friday after seeing initial weakness following the release of some disappointing economic data. The major averages moved firmly into positive territory, although they gave back some ground in late day trading.
Before the start of trading, the Commerce Department released a showing a slightly bigger than expected decrease in personal spending in the month of September. Spending fell by 0.3 percent compared to estimates of a 0.2 percent decrease. While the data added to a recent string of data indicating considerable weakness in consumer spending, selling pressure waned not long after the open, as many traders felt that the weakness was already priced into the markets.
Traders subsequently disregarded separate reports showing a substantial contraction in manufacturing activity in the Chicago-area as well as a reading on consumer sentiment that showed a record decline in October. The buying interest that emerged came as traders continued to pick up stocks at reduced levels following recent weakness.
In other news, Federal Reserve Chairman Ben Bernanke said Friday that government support of Fannie Mae (FNM) and Freddie Mac (FRE) must remain strong as the nation works its way through the remainder of the housing crisis. In addition, the Fed chief told a Berkeley, California audience that the federal government must continue to play an important role in the mortgage financing market in the future.
The major averages pulled back well off their highs in the last hour of trading, but they ticked back to the upside going into the close. The Dow closed up 144.32 points or 1.6 percent at 9,325.01, the Nasdaq closed up 22.43 points or 1.3 percent at 1,720.95 and the S&P 500 closed up 14.66 points or 1.5 percent at 968.75. With the gains on Friday extending the upward move seen earlier in the week, the major averages all posted strong gains for the week but still closed sharply lower for the month of October. The Dow posted an 11.3 percent weekly gain, but it fell 14.1 percent on the month.
In corporate news, the official Shanghai Securities News reported Friday that the net profit of 1,624 listed companies in the first nine months rose 7.1 percent from a year earlier to 782 billion yuan, slowing from about 16 percent for the first half.
Bank of Communications said that its third-quarter net profit rose nearly 22 percent to 7.21 billion yuan compared to an increase of 60 percent in the second quarter and 108 percent in the first quarter. China CITIC Bank reported a third-quarter net profit growth of 97 percent year-over-year to 4.034 billion yuan under Chinese accounting standards.
Hainan Airlines booked a loss of 260.8 million yuan in the third quarter, while Shanghai Airlines reported a loss of 437.4 million yuan.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.