Chinese stock market could sustain further damage on Monday

The Chinese stock market has ended lower in consecutive trading days, falling nearly 35 points, or 1.1 percent, along the way. The new Shanghai Composite Index is just below the 3,260-point plateau and could amplify its losses on Monday.

The global forecast for the Asian markets is mixed to ease on concerns about an economic slowdown and a rise in interest rates. The European markets were mixed and the US markets were sharply lower and the Asian markets share the difference.

The SCI ended slightly lower on Friday as losses on commodity inventories were offset by gains from energy producers, financial institutions and real estate.

For the day, the index lost 19.47 points or 0.59 percent to end at 3,258.08 after trading between 3,258.06 and 3,286.49. The Shenzhen Composite Index fell 28.54 points or 1.28 percent to end at 2,207.99.

Among the actives, Industrial and Commercial Bank of China rose 0.23 percent, while the Bank of China gathered 0.33 percent, China Merchants Bank added 0.39 percent, China Life Insurance improved 0.11 percent, Jiangxi Copper 0.65 lost percent, Aluminum Corp of China (Chalco) slipped 1.10 percent, Yankuang Energy rose 4.52 percent, PetroChina improved 1.37 percent, China Petroleum and Chemical (Sinopec) rallied 0.24 percent, Huaneng Power rocketed with the daily cap of 10 percent, China Shenhua Energy rose 2.48 percent, Gemdale rose 3.97 percent, Poly Developments peaked 3.70 percent, China Vanke improved 1.31 percent, China Fortune Land gained 0.69 percent, Beijing Capital Development rose 1.36 percent and China Construction Bank and Bank of Communications remained unchanged.

Wall Street’s lead is generally negative as the big averages opened sharply lower on Friday and remained deep in the red throughout the session.

The Dow fell 292.26 points or 0.86 percent to end at 33,706.74, while the NASDAQ plunged 260.08 points or 2.01 percent to close at 12,705.21 and the S&P 500 fell 55.26 points. or 1.29 percent to end at 4,228.48. For the week, the NASDAQ plunged 2.6 percent, the S&P fell 1.2 percent and the Dow fell 0.2 percent.

The weakness on Wall Street came as traders tried to take advantage of recent strength in the markets, which lifted key averages well from their June lows to their best levels in nearly four months.

Traders may also have taken money out of stocks ahead of this week’s economic symposium in Jackson Hole, Wyoming. Comments by Federal Reserve officials at the annual symposium are likely to draw attention as traders look for additional clues about the pace of future rate hikes.

Oil futures were slightly higher on Friday, but posted a weekly loss on concerns about the outlook for energy demand amid fears of a possible recession in Europe. West Texas Intermediate crude futures for September were up $0.27 or 0.3 percent to $90.77 a barrel.

Closer to home, China will see August prime rate numbers for one- and five-year loans later this morning; in July they were 3.7 percent and 4.45 percent respectively.

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