Beijing, China (BBN)-Chinese shares headed higher on Wednesday as efforts by Beijing to stabilise the local currency continued to bring some calm to equity markets.
China’s central bank kept the daily fix for the yuan stable for the fourth consecutive day at 6.5630 per dollar, nearly unchanged from Tuesday, reports BBC.
The Shanghai Composite was up 0.7 per cent to 3,045.85 in morning trade.
Trade data which showed that exports rose for the first time since June in December also boosted sentiment.
Chinese exports defied expectations to rise 2.3 per cent from a year ago in yuan-denominated terms.
Forecasts were predicting a 4.1 per cent fall.
Imports also beat expectations to only fall 4 per cent, compared to forecasts of a 7.9 per cent decline.
China’s central bank had been setting the guidance rate for the yuan lower last week to boost exports, which had raised concerns about whether the authorities thought growth was slowing more than expected.
“While the daily Chinese yuan midpoint fixing will still continue to hold the attention of global market participants, the effect may fade as yuan stabilises,” said Bernard Aw, market strategist at trading firm IG.
The overnight yuan rates in Hong Kong spiked as investors suspected that the central bank was buying the currency to support the market.
Hong Kong’s Hang Seng index rose 2.6 per cent to 20,221.82.
The rest of Asia also took a lead from a positive session on Wall Street, where both the Dow Jones and S&P 500 saw a second day of gains overnight, closing up 0.7 per cent.
Japan’s benchmark Nikkei 225 index was up 2.7 per cent to 17,682.33 – leading Asian gains after six days of declines.
A modest recovery in oil prices in Asian trading after US oil prices dipped below $30 a barrel also improved sentiment.
US oil futures rose for the first time in eight days with West Texas Intermediate crude up 30 cents to $30.74 a barrel.
Australia’s S&P/ASX 200 index was up 1 per cent at 4,974.40, while South Korea’s Kospi index was higher by 1.5 per cent at 1,918.10.