Additional Support Anticipated For China Stock Market

(RTTNews) - The China stock market on Monday snapped the two-day slide in which it had fallen almost 30 points or 0.9 percent. The Shanghai Composite Index now sits just above the 3,380-point plateau and it may add to its winnings on Tuesday.

The global forecast for the Asian markets in positive on an improved outlook for interest rates. The European markets were down and the U.S. bourses were up and the Asian markets figure to follow the latter lead. The SCI finished modestly higher on Monday following gains from the financial shares and resource stocks. For the day, the index gained 21.69 points or 0.65 percent to finish at 3,381.58 after trading between 3,347.65 and 3,389.45. The Shenzhen Composite Index added 18.64 points or 0.95 percent to end at 1,987.69. Among the actives, Industrial and Commercial Bank of China rallied 2.04 percent, while China Merchants Bank collected 0.57 percent, China Life Insurance dipped 0.17 percent, Jiangxi Copper rose 0.28 percent, Aluminum Corp of China (Chalco) perked 0.14 percent, Yankuang Energy added 0.57 percent, China Petroleum and Chemical (Sinopec) sank 0.70 percent, Huaneng Power stumbled 2.44 percent, Gemdale climbed 1.11 percent, Poly Developments eased 0.13 percent and China Vanke was unchanged.

The lead from Wall Street is upbeat as the major averages shook off early weakness, using a late-day surge to finish solidly in the green.

For the day, the Dow jumped 374.96 points or 0.89 percent to finish at 42,581.78, while the NASDAQ rallied 183.56 points or 0.94 percent to close at 19,630.97 and the S&P 500 climbed 57.33 points or 0.96 percent to end at 6,025.17.

The late rally came as Federal Reserve Vice Chair Michelle Bowman indicated support for a rate cut as early as July, citing concerns about the job market and potential easing of inflationary pressures related to tariffs. Additionally, reports of potential tariff reductions between the U.S. and China helped ease market anxieties.

The major averages had opened lower and hugged the unchanged line for much of the day as investors waited for Iran's response to the weekend U.S. air strikes on its nuclear sites.

In economic news, the National Association of Realtors said that existing home sales rose 0.8 percent on month in May and saw a 6.2 percent increase in unsold inventory. On a yearly basis, existing home sales fell 0.7 percent.

Crude oil prices were on a roller coaster ride on Monday, moving sharply higher earlier in the day in response to the U.S. bombing attack in Iran. But as it looks like Iran won't try to block the straight of Hormuz, prices plummeted later in the day. West Texas Intermediate crude for August delivery plunged $5.00 of 6.77 percent to $68.84 per barrel.