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Hopes of rate cuts, stimulus lift markets

Key market indices improved yesterday, amid indications of more stimulus measures and rate cuts to help stabilise coronavirus-spooked markets.
Hopes of rate cuts, stimulus lift markets Hopes of rate cuts, stimulus lift markets Hopes of rate cuts, stimulus lift markets Hopes of rate cuts, stimulus lift markets Hopes of rate cuts, stimulus lift markets

The IMF and World Bank joined forces to promise support to address the economic challenge posed by COVID-19

Staff reporter

The S&P 500 closed up 4.6% and China's Shanghai Composite Index gained 3.15%.

Futures were also pointing to a positive day on most markets.

Bank of Japan governor Haruhiko Kuroda said on Monday that Japan's central bank would take necessary steps to stabilise financial markets, following a similar move by US Federal Reserve chair Jerome Powell on Friday, Reuters reported.

Australia's Reserve Bank is widely expected to lower rates today.

Meanwhile in a joint statement, the IMF and World Bank Group promised support "to address the human tragedy and economic challenge posed by the COVID-19 virus".

They said they would use "available instruments to the fullest extent possible" including emergency financing.

The gold price had risen over US$1,600 an ounce earlier on the spot market but was back around $1,599/oz at the time of writing.

Most base metals improved on the London Metal Exchange on Monday.

Over the weekend China's official PMIs fell to record lows and the Caixin Manufacturing PMI missed estimates, Marex Spectrum's Anna Stablum said from the LME desk in Singapore yesterday.

"Still, the Caixin PMI business expectations improved, showing that February might be the low as economic activity is restored," she said.

Diversified miner Rio Tinto (LSE: RIO) rose 3.1% in London yesterday, Barrick Gold (TSX: ABX) closed up 3.5% in Toronto and copper major Freeport-McMoRan gained 5.4% in New York.