Chinese stocks rose overnight, thanks to the flurry of easing measures from its central bank (chart). The People's Bank of China lowered bank reserve requirements, cut interest rates, and will provide leverage to brokers to buy stocks.
Propping up stocks with government funding sounds more like panic than proactivity to us. But the skinny of the matter is that the Fed's 50bps rate cut last week provided the Chinese government with room to ease monetary policy without worrying about weakening their currency. The offshore yuan hit a 16-month high against the dollar overnight.
The story is likely to be the same for other global central banks. The upshot is more global monetary stimulus while global stocks are already reaching new record highs (chart).