Asian markets bounced back from a global rout today (August 26th) after China’s central bank took steps to stabilise stocks.
The People Bank of China (PBOC) cut its main interest rate by 0.25 percentage points to 4.6 per cent today (August 25th) in a bid to calm stock markets after shares tumbled for two consecutive days.
However, volatility remained on the Chinese market, with the Shanghai Composite Index falling nearly four per cent in the morning, before rising more than four per cent just before the close, and dropping again to close down 1.3 per cent at 2927.29.
Some analysts said the central bank move might not be enough. "They probably were not hard enough and strong enough to give the market a sign that they will support it in the next two three weeks, when things are going to get really volatile," said Evan Lucas, a market strategist at brokerage firm IG. "They haven’t outlined any specific measures to support the mainland market," he added.
Japan's Nikkei 225 stock index gained 3.2 per cent to 18,376.83, South Korea's Kospi was up 2.6 per cent to 1,894.09 and Australia's S&P ASX/200 rose 0.7 per cent to 5,172.80. Hong Kong's Hang Seng index fell 0.5 per cent to 21,305.17.