The Chinese stock market has experienced declines in two of the last three trading sessions, following a brief two-day rally that saw a significant increase of over 110 points, or 3.3%. Currently, the Shanghai Composite Index hovers slightly above the 3,450 mark and may encounter further downward pressure as trading commences on Monday.
The global market outlook for Asia is uncertain, with investors assessing the implications of recent U.S. election outcomes. While European markets registered losses, U.S. markets saw gains, suggesting that Asian markets might exhibit a mixed response.
On Friday, the Shanghai Composite Index (SCI) ended with a slight decrease, driven by declines in the financial sector, property market, and resource and energy stocks. The index fell by 18.36 points, or 0.53%, closing at 3,452.30, after fluctuating between 3,443.19 and 3,509.82 throughout the day. Meanwhile, the Shenzhen Composite Index dropped 6.02 points, or 0.29%, concluding at 2,094.69.
In terms of specific stock movements, Industrial and Commercial Bank of China fell by 0.65%, Bank of China decreased by 1.22%, and China Construction Bank dropped by 0.99%. China Merchants Bank and Agricultural Bank of China saw respective declines of 1.95% and 0.83%, while China Life Insurance edged down by 0.31%. Jiangxi Copper and Aluminum Corp of China (Chalco) experienced slight losses and gains of 0.56% and 0.24%, respectively. Key energy players such as Yankuang Energy, PetroChina, and China Petroleum and Chemical (Sinopec) saw varying declines, with PetroChina specifically dropping by 1.20%. Major property developers like Gemdale, Poly Developments, and China Vanke posted substantial losses of 5.77%, 4.03%, and 3.84% respectively.
Wall Street's performance provided some optimism, with the major indices opening higher on Friday and achieving moderate gains, reaching new record closing highs. The Dow advanced 259.65 points (0.59%) to 43,988.99, the NASDAQ rose 17.32 points (0.09%) to 19,286.78, and the S&P 500 increased by 22.44 points (0.38%) to end at 5,995.54.
For the week, the NASDAQ showed a notable increase of 5.7%, while the S&P 500 and the Dow climbed by 4.7% and 4.6% respectively. This upward trend reflects positive investor sentiment following former President Donald Trump's decisive victory in the U.S. presidential election, which is anticipated to be beneficial for corporations.
Market participants also reacted to the Federal Reserve's anticipated decision to reduce interest rates by a quarter-point. However, Fed Chair Jerome Powell emphasized that future rate adjustments will not follow a predetermined path, but will be evaluated at each meeting.
Oil prices saw a sharp decline on Friday, driven by concerns over demand following a reported decrease in China's oil imports and dissatisfaction with the scale of China's recent stimulus measures. West Texas Intermediate Crude oil futures for December dropped by $1.98, or 2.7%, to $70.38 a barrel, although the contract recorded a 1% increase over the week.
