SHANGHAI, Aug. 28 (SMM) – The Shanghai Composite Index surged 5.34% yesterday, improving market sentiment. It was reported China bought some blue-chip stocks Thursday afternoon to boost the stocks market. Goldman Sachs also reported it is time to buy Chinese stocks, inspiring global financial markets. PBOC financial research institute director said the exchange rate of yuan may stabilize and appreciate in the next 2-3 years. Finance Minister Lou Jiwei said China issued RMB 600 billion and RMB 3.2 trillion quotas for new local government bonds and local governments to replace their existing debts with new bonds, which will help stabilize Chinese economy.
Commodity prices also rebounded with China’s A-share market. WTI crude oil prices for October delivery closed up USD 3.96/bbl, up 10.26%, their biggest one-day gains in the last six years. EIA crude oil inventories fell 5.45 million barrels for the week ending August 19, compared to 3.70 million barrels decline, and 262 million barrels growth a week earlier. Venezuela called for an emergency meeting and appealed to coordinate with Russian to cope with falling crude oil prices.
US annualized Q2 growth rose 3.7% on the quarterly basis, higher than the flash figures and market expectations. The number of US initial jobless claims for the week ending August 22 was 271,000, compared to 274,000 expected and 277,000 a week earlier.
The US dollar index added 0.46% to 95.76. European and US stocks gained steam. LME base metals prices rebounded across the board.