Domestic equity benchmarks are likely to see a strong opening after a surprise rate cut by the Chinese central bank propelled European and US stocks higher on Friday and markets in the rest of Asia played catch-up by gaining as much as 1 per cent in trade on Monday morning.
China on Friday cut interest rates by 25 basis points to 4.35 per cent. This was the sixth rate cut by the Chinese central bank since November, 2014.
I do not think markets were expecting the Chinese rate cut on Friday," said Adrian Mowat of JPMorgan. "While there were expectations of further easing in China, the fresh move has taken markets by surprise," he said in an interview with ET Now. At 08:00 am, China's Shanghai Composite was up 0.75 per cent at 3,437.98. Japan's Nikkei rose 1.2 per cent to hit a two-month high. Markets across Hong Kong (up 0.40 per cent), South Korea (0.20 per cent) and Taiwan (0.70 per cent) added up to 0.70 per cent in early trade.
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