Chinese stock index jumps 5.3% as Asian shares rise

Chinese stock index jumps 5.3% as Asian shares rise

China’s key stock market index has surged 5.3%, its biggest gain in eight weeks, as markets across Asia rose following Wall Street’s rebound, giving investors some relief after gut-wrenching global losses.

The Shanghai Composite Index, whose steep drop in recent days triggered worldwide selling, gained 5.3% to close at 3,083.59 points, bouncing back from losses that wiped some 20% off its value over the past week. It was the biggest one-day gain since a 5.5% rise on June 30.

Elsewhere in Asia, Hong Kong’s Hang Seng rose 2.9% to 21,697.31 and Tokyo’s Nikkei 225 added 1.1% to 18,574.44. Sydney’s S&P ASX 200 advanced 1.2% to 5,233.30 and Seoul’s Kospi gained 0.7% to 1,908.00. Markets in Singapore, Bangkok, New Zealand and Jakarta also rose.

European markets also advanced in early trading. France’s CAC-40 added 2.1% to 4,597.36 and Germany’s DAX gained 2.4% to 10,240.92.

The gains came after Wall Street rocketed up overnight. The Dow Jones industrial average soaring more than 600 points, or 4%. That was its third-biggest point gain of all time and its largest since October 28, 2008.

Traders were encouraged by comments from William Dudley, president of the New York Federal Reserve Bank, that the case for a US interest rate hike in September is “less compelling to me than it was a few weeks ago”, given China’s troubles, falling oil prices and weakness in emerging markets.

“Traders took the cue to buy,” said Nicholas Teo, of CMC Markets, in a report.

Following a six-year run-up in US stocks that has pushed major indexes to all-time highs, investors worry the economy could falter if the Fed raises rates too soon.

US markets looked set for more gains, with futures for the Dow Jones and S&P both up 0.4%.

In currency markets, the dollar rose to 120.2220 yen from Wednesday’s 120.1440 yen. The euro edged down to 1.1327 dollars from the previous session’s 1.1337 dollars.

Benchmark US crude gained 92 cents to 39.53 dollars per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 71 cents on Wednesday to close at 38.60 dollars. Brent crude, used to price international oils, rose 1 dollar to 44.14 dollars in London after losing 7 cents the previous day to close at 44.14 dollars.

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