The China stock market headed right back up into positive territory again on Thursday - one session after it had ended the six-day winning streak in which it had collected nearly 140 points or 5.3 percent. The Shanghai Composite Index finished just above the 2,760-point plateau, and now investors are contemplating continued support when the market kicks off trade on Friday.
The global forecast for the Asian markets remains broadly optimistic on solid economic data from the United States and more good news from Greece. Oil stocks should continue to rebound, while technology and telecom stocks also figure to provide support. The European and U.S. markets finished sharply higher, and now the Asian bourses are also expected to track higher.
The SCI finished sharply higher on Thursday, supported by gains from the coal miners, metal companies and other resource stocks.
For the day, the index jumped 33.60 points or 1.2 percent to finish at 2,762.08 after trading between 2,729.99 and 2,774.37. The Shenzhen Composite Index climbed 16.03 points or 1.4 percent to end at 1,155.89.
Among the gainers, China Shenhua Energy added 2.7 percent, while Shanxi Xishan Coal climbed 1.8 percent, Jiangxi Copper surged 3.5 percent and Inner Mongolia Baotou Steel collected 0.7 percent.
The lead from Wall Street is positive as stocks turned in another strong performance on Thursday, extending recent gains. The markets continued to benefit from news out of Greece as well as upbeat Chicago-area manufacturing data.
After the crucial vote in favor of a package of austerity measures on Wednesday, traders continued to keep an eye on Greece, which took another step steps towards receiving additional financial assistance. The Greek parliament voted 155 to 136 to pass a second bill that enables the rapid implementation of the austerity plan, which includes billions of euros in spending cuts and tax increases.
The markets also benefited from the release of a report from the Institute for Supply Management - Chicago showing that Chicago-area manufacturing activity unexpectedly expanded at an accelerated pace in the month of June. The ISM - Chicago said its business barometer jumped to 61.1 in June from 56.6 in May, with a reading above 50 indicating an increase in activity. The increase surprised economists, who had expected a decline to 53.0.
The release of the relatively upbeat report on Chicago-area activity came after the Federal Reserve Banks of New York and Philadelphia released separate reports showing unexpected deteriorations in regional manufacturing activity.
The major averages ended the day firmly in positive territory, at their best closing levels in a month. The Dow jumped 152.92 points or 1.3 percent to 12,414.34, the NASDAQ surged up 33.03 points or 1.2 percent 2,773.52 and the S&P 500 advanced 13.23 points or 1 percent to 1,320.64.
In economic news, China will on Friday release the results of its June purchasing managers' index for manufacturing with analysts expecting a score of 51.5, down from 52 in May.
Also, China's State Information Center on Thursday said that consumer prices in the economy likely peaked 5.3 percent in the first half of 2011. The government agency, that published its latest research data in China Securities Journal, said that there is little possibility for consumer prices to set new highs in the second half of year.
According to SIC, inflation may retreat to 4.5 percent to 5.5 percent during the second half. The think tank forecast the economy to grow at a robust pace of 9.5 percent in the first half of the year, with little chance of a hard landing.
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