Higher Open Called For China Stock Market

(RTTNews) - Bisected by the long Lunar New Year break, the China stock market has moved lower in two straight sessions, shedding me than 30 points or 1 percent in that span. The Shanghai Composite Index now rests just beneath the 3,230-point plateau although it's likely to cut into those losses on Thursday.

The global forecast for the Asian markets is upbeat following a drop in U.S. treasury yields. The European markets were mixed and the U.S bourses were slightly higher and the Asian markets figure to split the difference.

The SCI finished modestly lower on Wednesday following losses from the financial shares, property stocks and resource companies.

For the day, the index dropped 21.11 points or 0.65 percent to finish at 3,229.49 after trading between 3,220.28 and 3,271.02. The Shenzhen Composite Index added 8.50 points or 0.44 percent to end at 1,919.59.

Among the actives, Industrial and Commercial Bank of China retreated 1.91 percent, while Bank of China sank 2.39 percent, China Construction Bank slumped 1.87 percent, China Merchants Bank declined 1.60 percent, Agricultural Bank of China tumbled 2.13 percent, China Life Insurance plunged 2.71 percent, Jiangxi Copper fell 0.43 percent, Aluminum Corp of China (Chalco) climbed 1.03 percent, Yankuang Energy weakened 1.19 percent, PetroChina stumbled 2.16 percent, China Petroleum and Chemical (Sinopec) dropped 0.99 percent, Huaneng Power rallied 1.55 percent, China Shenhua Energy tanked 2.95 percent, Poly Developments skidded 1.08 percent, China Vanke surrendered 4.13 percent and Gemdale was unchanged.

The lead from Wall Street is positive after the major averages opened lower on Wednesday but turned higher into the green as the day progressed, ending at session highs.

The Dow rallied 317.24 points or 0.71 percent to finish at 44,873.28, while the NASDAQ added 38.31 points or 0.19 percent to close at 19,692.33 and the S&P 500 gained 23.60 points or 0.39 percent to end at 6,061.48.

The rebound on Wall Street came amid a notable move to the downside by treasury yields, with the yield on the benchmark ten-year note slumping to its lowest closing level in well over a month.

Yields tumbled after the Treasury Department said its current auction sizes leave it well positioned to address potential changes to the fiscal outlook. Based on projected borrowing needs, the Treasury anticipates maintaining long-term securities auction sizes for at least the next several quarters.

In economic news, the Institute for Supply Management said service sector growth in the U.S. unexpectedly slowed modestly in January. Also, payroll processor ADP said private sector employment in the U.S. increased more than expected last month.

Oil prices settled sharply lower Wednesday after data showed a sharp jump in U.S. crude inventories last week. Concerns about the outlook for oil demand also weighed on prices. West Texas Intermediate Crude oil futures for March settled at $71.03 a barrel, losing $1.67 or 2.29 percent.