Chinese stocks rebound after worst trading day in a year

Overview

  • Chinese stocks suffer worst day in a year
  • European stocks climb
  • Dollar drifts further down
  • US oil at 2015 highs

Chinese stocks weakened after authorities are looking to deleverage the economy. China’s debt bubble, particularly in the corporate sector, is widely known.

Markets in China are beginning to find support, although trading remains volatile. Hong Kong’s Hang Seng Index lost 1% lower on Thursday, illustrating how trepidation on mainland China can spread. The index has since added 5%, showing how reliant the bullish sentiment in equity markets has been.

European equities edged higher, supported by a rally in consumer and financial markets.

The dollar remains under pressure, falling 0.1% against its peers. The lack of progression in tax reform has added a bearish tone to the greenback.

The euro is 0.2% stronger against the greenback, while the pound has also added 0.2% against the dollar.

Oil markets are on an upward swing, with crude oil adding 1.1%, propelling past the $58 mark and looking closer to $59. Brent oil is 0.4% higher on Thursday.

The rally was intitated by the closure of TransCanada’s Keystone pipeline.

Despite the weaker greenback, gold has lost 0.2%. The strong bullish sentiment in equity markets has severely capped gains for this safe-haven asset.