Global equities climbed to a new high on Tuesday after China revealed a string of measures overnight aimed at reinvigorating the world’s second-largest economy.
The MSCI World index, the acknowledged proxy for equity markets globally, climbed 0.3% to hit a new record on Tuesday on the back of the measures, which will see interest rates and banks’ cash reserve requirements cut.
This followed a jump in Chinese stocks on Tuesday, with the Shanghai Composite and CSI300 index each adding over 4% while markets in Europe also gained.
In London, miners led the FTSE 100 higher as the Chinese announcements sent commodity prices upwards, notably oil and copper.
Antofagasta PLC (LSE:ANTO) took the spot of the day’s biggest gainer, having climbed by 6.9%, ahead of Anglo American PLC (LSE:AAL) and Asia-focused insurer Prudential PLC (LSE:PRU).
In Europe, France's CAC 40 index led the way, up 1.2% as luxury goods names such as Louis Vuitton Moet Hennessy (EPA:MC) and Hermes both rose over 3% as investors anticipated a boost in spending from Chinese middle-class shoppers.
"It was the coordinated announcement that has caught markets off guard, with the decision to implement them all at once bringing a significant shift that many hope will turn the tide after years of slow growth and minimal inflation," Scope Markets analyst Joshua Mahony commented.
"For traders, the question remains over the size and speed of any benefits that these measures seek to bring, with the gains seen across the commodity space happening as a response of sentiment rather than any shift in demand."