More Volatility Likely For China Stock Market

(RTTNews) - The China stock market on Tuesday wrote an emphatic finish to the two-day winning streak in which it had gathered almost 70 points or 2.3 percent. The Shanghai Composite Index closed just above the 3,030-point plateau, and the market figures to see more wild swings again on Wednesday.

The global forecast for the Asian markets is murky, thanks to conflicting data from the United States and slightly overbought markets that suggest profit taking. The European markets were higher and the U.S. bourses were mixed but little changed - and the Asian markets figure to follow the latter lead.

The SCI finished sharply lower on Tuesday with losses across the board - particularly among the financial and energy sectors.

For the day, the index plunged 94.83 points or 3.03 percent to finish at 3,032.61 after trading between 3,025.67 and 3,136.84 on turnover of 419.5 billion yuan. The Shenzhen Composite Index dropped 19.68 points or 1.39 percent to end at 1,392.62 on turnover of 206.2 billion yuan.

Among the actives, Bank of China shed 4.37 percent, while Bank of Communications dropped 5.2 percent, Agricultural Bank of China tumbled 5.6 percent, PetroChina lost 5.6 percent, China Petroleum and Chemical (Sinopec) plunged 5.0 percent and Metallurgical Corp. of China fell 6.3 percent.

The lead from Wall Street provides little clarity as stocks turned in a lackluster performance on Tuesday following the release of a mixed batch of U.S. economic data. Despite the choppy trading, the Dow closed above 18,000 for the first time and set a new record closing high along with the S&P 500.

The NASDAQ fell 16.00 points or 0.3 percent to 4,765.42, while the Dow climbed 64.73 points or 0.4 percent to 18,024.17 and the S&P 500 edged up 3.63 points or 0.2 percent to 2,082.17.

Early buying interest was generated by a report from the Commerce Department showing much stronger than previously estimated third quarter GDP growth. But the Commerce Department also reported an unexpected decrease in durable goods orders and new home sales.

Relatively light trading activity also contributed to the lackluster performance, as some traders got a head start on the holidays.