PEKING (dpa-AFX) - The China stock market has closed lower in three consecutive trading days, giving away more than 40 points or 1.8 percent en route to a six-week closing low. The Shanghai Composite Index ended just above the 2,330-point plateau, and now investors are looking for a slightly higher open when the market kicks off trade on Monday.
The global forecast for the Asian markets is mixed and flat, with analysts expecting little movement as the U.S. bourses will remain closed for the Memorial Day holiday. Providing mild support was a report from Reuters and the University of Michigan showing that U.S. consumer sentiment in May had improved by more than expected. But lingering concerns about the financial situation in Europe remain likely offset any positive sentiment. The European markets were slightly higher and the U.S. bourses were slightly lower - and the Asian markets figure to split the difference.
The SCI finished modestly lower on Friday following losses from the property stocks and financial shares.
For the day, the index retreated 17.42 points or 0.74 percent to finish at 2,333.55 after trading between 2,327.41 and 2,355.81. The Shenzhen Composite Index plummeted 1.2 percent to end at 935.05.
Among the decliners, China Construction Bank eased 0.2 percent, while Industrial and Commercial Bank of China also fell 0.2 percent, China Vanke lost 0.8 percent and Tianjin Reality Development dropped 1.5 percent.
The lead from Wall Street offers mild pessimism as stocks turned in another lackluster performance on Friday, with many traders getting a head start on the long weekend. The major averages bounced back and forth across the unchanged line after closing mixed in each of the three previous sessions.
Traders largely shrugged off a report from Reuters and the University of Michigan showing that U.S. consumer sentiment in May had improved by more than previously estimated. The consumer sentiment index for May was upwardly revised to 79.3 from the mid-month reading of 77.8. The upward revision surprised economists, who had expected no change. The index now is well above the final April reading of 76.4 and is at its highest level since October of 2007.
Lingering concerns about the financial situation in Europe likely offset any positive sentiment generated by the better than expected reading on consumer sentiment.
Among individual stocks, shares of Talbots (TLB) tumbled 41 percent after private equity firm Sycamore Partners said it is not prepared to acquire the women's apparel retailer. Verifone (PAY) also posted a steep loss after the electronic payments company reported better than expected second quarter earnings but forecast full year results.
Meanwhile, Frontline (FRO) posted a strong gain after the oil tanker operator reported better than expected first quarter earnings and provided upbeat guidance. Futures exchange operator CME Group (CME) also ended the day higher after announcing a 5-for-1 split of its common stock in the form of a 400 percent stock dividend.
The major averages eventually ended the day in the red as the Dow fell 74.92 points or 0.6 percent to finish at 12,454.83, while the NASDAQ edged down 1.85 points or 0.1 percent to end at 2,837.53 and the S&P 500 slipped 2.86 points or 0.2 percent to 1,317.82. Despite the losses on the day, the major averages all moved higher for the week, bouncing off last Friday's four-month lows. The Dow rose by 0.7 percent, while the NASDAQ and the S&P 500 advanced by 2.1 percent and 1.7 percent, respectively.
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© 2012 AFX News
