Global equity markets snapped back yesterday from a worldwide decline the previous session on China’s steps to stimulate its economy and solid corporate earnings, while the euro weakened amid worries that Greece may default.
European stocks shrugged off declines in Asia where Chinese shares fell sharply on fears of a regulatory crackdown on the world’s hottest stock market, which offset the People’s Bank of China's most aggressive move yet to bolster the slowing economy.
The Chinese central bank reduced the amount of cash banks must hold as reserves in a move to help spur lending and combat a slowing economy.
In Europe, mining stocks helped Britain’s top share index rebound on China’s stimulus measures to support stuttering growth in the world's biggest consumer of metals. The FTSE 350 mining index rose 1.9 per cent.
MSCI’s all-country world index rose 0.43 per cent while the pan-European FTSEurofirst 300 index of top regional shares gained 0.8 per cent to 1,619.92. Shares also rose on solid corporate results.
Investment bank Morgan Stanley reported its most profitable quarter since the financial crisis. Shares rose 1.1 per cent to $37.17.
On Wall Street, the Dow Jones industrial average rose 226.05 points, or 1.27 per cent, to 18,052.35. The S&P 500 gained 18.14 points, or 0.87 per cent, to 2,099.32 and the Nasdaq Composite added 41.83 points, or 0.85 per cent, to 4,973.64.
The euro slid against the dollar amid worries that Greece might leave the single currency zone.
The euro was down 0.46 per cent at $1.0755.
Against the yen, the dollar rose 0.36 per cent to 119.33 yen while the dollar index rose 0.25 per cent to 97.773.
Government debt yields continued to vanish across the eurozone. Belgium became the sixth eurozone country to sell five-year bonds at a negative yield after Finland, Germany, Austria, the Netherlands and France.
The benchmark 10-year German bund fell in price, pushing its yield up to 0.077 per cent, up from a record low of 0.05 per cent on Friday.
Oil prices rose in volatile trading as tensions in the Middle Eastand a drop in the number of US rigs drilling for crude offset comments from Saudi Arabia’s oil minister that Saudi production would stay near record levels in April.
Brent crude was up 81 cents at $64.26 a barrel. US crude for May delivery was up $1.32 at $57.06.