Asian shares staged a rebound in morning trading on the back of the Wall Street’s biggest one day gain since 2011.
Markets were trading up across Asia, including China, following volatile trade yesterday and big losses earlier this week.
The Shanghai Composite is up 1.66 per cent, near the critical 3,000 mark, having risen as much as 2.3 per cent. This follows five consecutive days of decline in China.
Japan’s Nikkei is trading 0.84 per cent up, building on its 3.2 per cent gain yesterday, while the Hang Seng is 2.24 per cent up and the ASX 200 is 1.24 per cent up.
This follows strong gains in the US yesterday. After six consecutive days of decline, the Nasdaq climbed by 4.24 per cent yesterday, while the Dow Jones and S&P 500 rose 3.95 and 3.9 per cent respectively.
US stocks rallied on the expectation that the Federal Reserve will hold off from an interest rate hike for longer than anticipated, in the face of growing global uncertainty thanks to China.
However, Naeem Aslam, chief market analyst at AvaTrade, said:
In the US, it was all about the comments by the president of the New York Reserve, William Dudley, who has played his part in calming the nerves of the market participants. From his comments it is clear that September is not the strongest candidate anymore and the Fed has developed a few more mandates which should meet before the Federal Reserve can finally raise the interest rate.
Nonetheless, I am still optimistic when it comes to September because if the US non-farm payroll data which is due in a few weeks does show a strong reading, this could change the game faster than you think.