Global stocks rise as China rebounds
HONG KONG - Asian stocks rebounded on Thursday as Chinese government measures aimed at stabilizing free-falling share prices took hold. European benchmarks gained as Greece's government raced to finalize details of reforms as it seeks a third bailout from European nations.
In early European trading, France's CAC-40 added 1.2 percent to 4,693.44 and Germany's DAX rose 0.9 percent to 10,842.77. Britain's FTSE 100 gained 0.6 percent to 6,528.71. Futures pointed to a rise on Wall Street following the previous day's sell-off. Dow futures were up 0.9 percent and broader S&P 500 futures jumped 1.1 percent.
Frantic efforts by authorities to arrest the nearly monthlong slide in the country's stock markets appeared to be giving the market an artificial bounce, analysts said. A flurry of measures announced Wednesday included a government order to state companies and executives to buy shares. A directive from the China Securities Regulatory Commission requires investors owning more than 5 percent of a company's shares to not sell any of their holdings for the next six months.
"Movements in the Chinese stock market don't necessarily correlate to China's economy," said analyst Jasper Lawler at CMC Markets in Singapore. "This applied on the way up when Chinese stocks rallied over 100 percent in the space of a year while economic growth was the slowest in six years. This should also be the case on the way down; just because stocks are crashing, it doesn't necessarily have a knock-on effect on China's economy."
Greece's government is racing to finalize a plan of reforms for its third bailout, hoping the proposal will meet with approval from its European partners and stave off a potentially catastrophic exit from Europe's joint currency, the euro, within days. Prime Minister Alexis Tsipras was meeting Thursday with finance ministry officials after the government requested a new three-year aid program from Europe's bailout funds and promised to immediately enact reforms, including to taxes and pensions, in return. Details of Greece's reforms must be submitted by Friday morning, giving time for creditors to review them ahead of a summit of the European Union's 28 members set for Sunday.
The Shanghai Composite in mainland China surged 5.8 percent to 3,709.33 after initially opening sharply lower. Hong Kong's Hang Seng rebounded 3.7 percent to 24,392.79 a day after suffering its biggest drop since the financial crisis. Other markets turned from losses to gains. Japan's Nikkei 225 rose 0.6 percent to 19,855.50 and South Korea's Kospi added 0.6 percent to 2,027.33. Australia's S&P/ASX 200 ended little changed at 5,471.00. Markets in Singapore and Taiwan fell while Thailand and the Philippines rose.
Benchmark U.S. crude rose 53 cents to $52.19 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 68 cents to close at $51.65 a barrel on Wednesday. Brent crude, an international benchmark, rose 75 cents to $57.80 in London.
The dollar rose to 121.33 yen from 120.80 in late trading Wednesday. The euro slipped to $1.1040 from $1.1072.