Oversold China Market Nonetheless Called Lower Again On Tuesday

(RTTNews) - The China stock market has moved lower in six straight sessions, slumping nearly 210 points or 7.7 percent along the way. The Shanghai Composite Index now rests just above the 2,700-point plateau and it's likely to open in the red again on Tuesday.

The global forecast for the Asian markets is soft on fading hopes that the FOMC will trim interest rates at next month's meeting. The European and U.S. markets were down and the Asian markets figure to follow suit.

The SCI finished sharply lower again on Monday following losses from the resource stocks and properties, while the financial sector offered support.

For the day, the index skidded 27.97 points or 1.02 percent to finish at 2,702.19 after trading between 2,635.09 and 2,739.74. The Shenzhen Composite Index tumbled 58.60 points or 3.93 percent to end at 1,433.10.

Among the actives, Industrial and Commercial Bank of China spiked 2.32 percent, while Bank of China soared 2.78 percent, China Construction Bank and China Merchants Bank both rallied 1.59 percent, Bank of Communications jumped 1.99 percent, China Life Insurance surged 2.94 percent, Jiangxi Copper sank 0.79 percent, Aluminum Corp of China (Chalco) shed 0.72 percent, Yankuang Energy accelerated 3.44 percent, PetroChina climbed 2.59 percent, China Petroleum and Chemical (Sinopec) strengthened 2.21 percent, Huaneng Power retreated 1.27 percent, China Shenhua Energy gained 3.00 percent, Gemdale plummeted 7.88 percent, Poly Developments dropped 0.96 percent, China Vanke plunged 3.27 percent and Haitong Securities slumped 1.06 percent.

The lead from Wall Street negative as the major averages opened lower on Monday and remained in the red throughout the trading day.

The Dow tumbled 274.30 points or 0.71 percent to finish at 38,380.12, while the NASDAQ shed 31.28 points or 0.20 percent to end at 15,597.68 and the S&P 500 slipped 15.80 points or 0.32 percent to close at 4,942.81.

The early weakness on Wall Street came as some traders looked to cash in on last week's rally amid fading optimism about the likelihood the Federal Reserve will cut interest rates in March.

Fed Chair Jerome Powell reiterated the central bank is unlikely to cut interest rates next month during an interview over the weekend. Powell suggested the strength of the U.S. economy even amidst elevated rates will allow the Fed to proceed carefully.

Stocks fell to their lows of the session as the Institute for Supply Management released a report showing U.S. service sector growth accelerated by more than expected in January, further dampening hopes for a rate cut.

Oil futures settled higher on Monday as concerns about trade and supply disruptions outweighed a firm dollar. West Texas Intermediate Crude oil futures for March settled lower by $0.50 or 0.7 percent a barrel at $72.78 a barrel.