Consolidation Called For China Stock Market

(RTTNews) - The China stock market has moved higher in four straight sessions, advancing more than 120 points or 3 percent along the way. The Shanghai Composite Index now sits just above the 4,080-point plateau although it may run out of steam on Thursday.

The global forecast for the Asian markets is weak, as traders are expected to lock in gains with several markets at or near record highs. The European and U.S. markets were mostly in the red and the Asian bourses figure to follow suit.

The SCI finished slightly higher on Wednesday as gains from the energy and insurance companies were offset by weakness from the financial shares and property stocks.

For the day, the index added 2.10 points or 0.1 percent to finish at 4,085.77 after trading between 4,069.44 and 4,098.78. The Shenzhen Composite Index rose 2.75 points or 0.11 percent to end at 2,620.52.

Among the actives, Industrial and Commercial Bank of China shed 0.64 percent, while Bank of China tumbled 1.94 percent, Agricultural Bank of China dropped 0.93 percent, China Merchants Bank lost 0.47 percent, Bank of Communications sank 0.70 percent, China Life Insurance soared 3.94 percent, Jiangxi Copper stumbled 2.97 percent, Aluminum Corp of China (Chalco) added 0.57 percent, Yankuang Energy rallied 3.61 percent, PetroChina retreated 1.69 percent, China Petroleum and Chemical (Sinopec) slumped 1.29 percent, China Shenhua Energy climbed 1.18 percent, Gemdale contracted 1.25 percent, Poly Developments skidded 1.39 percent, China Vanke tanked 2.07 percent and Huaneng Power was unchanged.

The lead from Wall Street is soft as the major averages opened slightly higher on Wednesday and hugged the line for much of the day before a late slump saw them end mixed.

The Dow dropped 466.00 points or 0.94 percent to finish at 48,996.08, while the NASDAQ rose 37.10 points or 0.16 percent to close at 23,584.28 and the S&P 500 sank 23.89 points or 0.34 percent to end at 6,920.93.

The choppy trading on Wall Street came as traders took a step back to assess the recent strength in the markets, which lifted the Dow and the S&P 500 to new record closing highs on Tuesday.

Traders were also digesting the latest U.S. economic data, including a report from payroll processor ADP showing private sector employment increased less than expected in December.

Also, the Labor Department said job openings in the U.S. fell more than expected in November, while the Institute for Supply Management noted an unexpected increase by its reading on U.S. service sector activity in December.

Crude oil prices plunged again on Wednesday due to emerging supply side concerns following U.S. attempts to gain control of Venezuelan oil wealth. West Texas Intermediate crude for February delivery was down $1.11 or 1.94 percent at $56.02 per barrel.