USA stocks open higher, lifted by strong job gains

Sharp drops in Chinese stocks, brought on by weak economic data and an acceleration in the depreciation of the yuan, sent shockwaves through global markets this week. “There’s no doubt it is a very, very tough time, and the fact that our largest trading partner is now being questioned on whether it has control of its economy is making things pretty tough”, said IG Markets strategist Evan Lucas.

Also, the country’s huge manufacturing sector is a major buyer of machinery and basic materials such as copper and oil, often from countries such as Brazil and Russian Federation. China’s currency allows the range to deviate 2 percent either side of the midpoint.

Brent crude, used to price global oils, rose 70 cents to $34.45 a barrel in London. “China is a command economy but you can not have a command stock market”.

The government s attempts to appease the nation s army of retail investors comes just a month ahead of the Chinese New year celebrations, a time when hundreds of millions of people travel for traditional family gatherings. China twice triggered its “circuit-breaker” safeguard – meant to prevent greater losses once shares fall to a certain threshold – to stop trading. The CSI 300 Index of the largest listed companies in Shanghai and Shenzhen bumped 2 percent, to 3,361.56. “The circuit breakers were poorly designed and were designed nearly to instil panic, which is exactly what happened”.

But a sign of relief for investors was that the yuab’s decline for eight consecutive days came to a halt on Friday, highlighting the Chinese monetary authorities’ determination to keep the currency stable. The investors at United States stock markets built negative sentiment owing to the slump in Chinese markets’.

The Chinese central bank also took steps to reinforce the yuan following the weakness of the money was taken as an indication of issues for the market. It is only a few months since Beijing won the long-sought-after prize of being awarded reserve currency status by the International Monetary Fund, alongside the dollar, yen and pound.

On Thursday, authorities lowered the yuan’s central rate against the USA dollar by 0.51 per cent to 6.5646, the lowest since March 2011.

Global markets stabilized, with U.S. stocks halting a two-day rout and the dollar advancing after China shored up its markets and a surge in USA payrolls boosted optimism in the economy. The S&P 500 closed down 2.37% while the Dow Jones Industrial Average shed 392 points, down 2.32%.

Japan’s Nikkei 225 also ended its session in the red territory.

It was up 0.02 percent from Thursday, when it was set at its lowest level in almost five years. The energy sector pulled the index down today.

Not to be left out, Hong Kong’s Hang Seng market clocked up a 6.67 per cent loss for the week, but this wasn’t the worst for the country.

Aussie’s S&P/ASX 200 plunged 0.39% on Friday. The real plunged 33 percent last year and is forecast to weaken 7 percent more in 2016, while the lira fell 25 percent in 2015 and will slip another 3 percent this year.