Stocks rebound in global markets after dizzying losses

London: Global stocks rebounded Tuesday on hopes of US economic stimulus efforts as the coronavirus rages, one day after suffering their biggest losses in more than a decade.

Trading is exceptionally volatile as investors attempt to get a grip on a rapidly changing news flow, with positive reports of progress in China on the virus clashing with a Saudi decision to increase oil output in an already over-supplied market. "Markets are surging on hopes of a huge stimulus plan from (US President) Donald Trump, but will it be enough to reverse the selloff?" said analyst Joshua Mahony at trading firm IG. "Meanwhile, the Italian lockdown raises fears of similar action for other European nations."

In late morning trade, London's benchmark FTSE 100 index of major blue-chip companies was up 4.0 per cent, aided by a 10-per cent rebound in oil prices despite the Saudi announcement.

In the eurozone, Frankfurt's DAX 30 jumped 3.5 per cent and the Paris CAC 40 rallied 4.2 per cent. In Milan, the FTSE MIB won 3.3 per cent after plunging more than 11 per cent Monday, as the Italian government unveiled more drastic measures to curb the coronavirus outbreak there.

"Europe is off to a more positive start on Tuesday, after stocks suffered their worst losses since the global financial crisis at the start of the week," said analyst Craig Erlam at traders OANDA.