LOS ANGELES (MarketWatch) — Sometimes, good news is bad news.
For months now, the markets have eagerly awaited a major easing move from the People’s Bank of China. At even the slightest hint of a coming rate cut or even just another trimming of banks’ reserve ratios, stocks have rallied, believing that monetary-policy support would keep the world’s second-largest economy safe for a “hard landing.”
Then, at long last, Beijing delivered with a quarter-point decrease to the policy rates, while adding some interest-rate liberalization measures for an extra kick.
Over in the U.S., the move sent Wall Street higher in Thursday morning trade, with shares making gains that held until later in the session, when Fed chief Ben Bernanke failed to promise more U.S. easing for the near future.