Markets rebound as US cuts interest rates

China’s stock market rallied on Wednesday as bourses across Asia were given a bump by an unexpected cut in US interest rates, the Wall Street Journal reported. The Shanghai Composite Index rose 3% to close at 4,703.04 points, having slipped 7.2% on Tuesday to hit 4,559.75. Hong Kong’s Hang Seng Index, which plummeted 8.7% on Tuesday, recouped all of its losses to finish up 10.7% at 24,090.17. The earlier selloffs came amid fears of an American recession and a consequent cutback in purchases of Asian exports. But on Tuesday the US Federal Reserve moved to restore confidence in the markets by shaving three quarters of a percentage point off interest rates. However, the SCI is still down by more than 10% so far this year, having gained 97% in 2007.