Investors also got some encouraging news from a survey indicating that U.S. consumer confidence rebounded this month.
All 30 members of the Dow were in positive territory, with especially strong gains for Apple (+5.1 per cent), JPMorgan Chase (+3.8 per cent) and Procter & Gamble (+2.9 per cent).
But small-caps remained under selling pressure, with Shenzhen’s start-up board ChiNext down 4.3 percent, and the CSI500 index tracking small listed companies declining 3.8 percent. The Nasdaq composite rose 109 points, or 2.4 percent, to 4,635.
Best Buy was the biggest gainer in the S&P 500 index.
The 1,100-point decline in just the initial six minutes of trading on Monday was the highest single-day loss in Dow Jones history, edging out a previous record daily fall of 800 points.
Markets across Asia were holding their breath on Wednesday after early hopes that the worst of this week’s turmoil could be behind them were tempered by concern that China has not done enough to stabilise its economy.
But the rebound really gathered momentum as China’s central bank slashed interest rates, an emergency action aimed at calming financial markets and boosting economic growth.
The People’s Bank of China (PBoC) cut its benchmark lending and deposit interest rates by 0.25 percentage points each and its reserve requirement ratio by 0.50 percentage points – the second such combination move in two months.
The main US and China stock markets initially went separate ways on Tuesday as the benchmark Shanghai index closed 7.6 per cent lower, prompting the Chinese rate cuts and Beijing officials to ease up on the amount that China’s banks must hold in reserve to cover risks.
“The Chinese economy is going to be on this bumpy road for a while and it will have ebbs and flows that will no doubt have a serious impact on the global economy“, he says. “What we are seeing now is a dress rehearsal of things to come”.
This was compounded by another turbulent session on Asian markets overnight to send the FTSE more than 2%, or around 130 points lower, shortly after opening, before paring back some of the losses.
All three major indices closed lower for a sixth straight day, falling more than 1%. Shares of Alibaba, the Chinese e-commerce giant, rose 4.18 percent in the early trading.
“These are specific issues which refer to fundamentals in other markets and do not reflect the situation in Europe“.
After Monday’s Wall Street selloff – its steepest in four years – some investors bought on the dip.
In other trading, U.S. crude oil rose 26 cents to $39.57 a barrel in electronic trading on the New York Mercantile Exchange.