Worldwide stock markets rose Friday after China increased interest rates for the fourth time this year. The boost comes after stocks across Asia, Europe, and the Americas had already climbed Thursday following the European Central Bank’s signaling that it was ready to increase the scope of its stimulus measures.
ECB chief Mario Draghi announced Thursday that the central bank was ready to adjust “the size, composition and duration” of its QE program.
The S&P 500 gained 0.7 percent to reach its highest level since Aug. 20, when a sell-off period was sparked by weak data coming out of China.
The Dow Jones industrial average .DJI rose 109.6 points, or 0.63 percent, to 17,598.76; the S&P 500 .SPX gained 18.1 points, or 0.88 percent, to 2,070.61; and the Nasdaq Composite .IXIC climbed 92.72 points, or 1.88 percent, to 5,012.77.
China’s surprise move saw it cut its benchmark one-year lending rate by 25 basis points to 4.35 percent.
The FTSEurofirst .FTEU3 was up 2 percent adding to what will be a fourth-straight week of gains for MSCI’s 45-country All World index .WORLD.
Speaking to Reuters about the China cut, Societe Generale FX Strategist Alvin Tan said, “It is basically throwing more fuel into the global risk rally after Draghi’s pretty bold moves yesterday.”.
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