Chinese stocks rally to their best day in more than 2 years

China’s rally comes after last week’s report on a weaker-than-expected third-quarter GDP growth. Investment bank Nomura said Monday it expects Beijing to roll out more easing and stimulus measures in the months ahead. Chinese officials made attempts to boost the beaten down market via supportive statements Friday about the economy and financial markets, which helped stocks Friday, but for the week, the Shanghai Composite still lost 7.6%.

Over the weekend, President Xi Jinping emphasized China’s support for the private sector, according to the official Xinhua News Agency. Beijing also released new details on proposed personal income tax cuts. The Chinese president’s comments followed moves on Friday by Vice Premier Liu He — Xi’s top economic official — as well as the head of the central bank and two financial regulators to reassure investors.

More stimulus is on the way, including major tax and fee cuts that could be worth more than 1% of GDP, the state-owned Shanghai Securities News quoted Ma Jun, a policy adviser to the People’s Bank of China.

Looking at Chinese stocks in the long run, they have historically underperformed compared to American and European stocks. The markets are trading at the lowest level in 4 years. Chinese stocks have fallen steadily throughout October as rising concerns about the cadence of corporate earnings and fear that a rise in the interest rate will begin to lower global growth.

U.S. equity futures advanced alongside European stocks after Chinese officials pledged to support the world’s second-biggest economy, helping to kick-start the rally in Asia. The dollar and Treasuries were steady, while Italian bonds rose.

This week is the peak period of the U.S. earnings season, with Amazon, Alphabet, Microsoft and Caterpillar among the companies reporting.

Helped by a strong economy and deep corporate tax cuts, S&P 500 earnings per share are expected to grow 22% in the third quarter, according to I/B/E/S data from Refinitiv.

The outlook for global growth in 2019 has dimmed for the first time, according to Reuters polls of economists, who cautioned that the U.S.-China trade war and tightening financial conditions could trigger the next downturn.