European stocks and global bond yields rebounded Tuesday after China, the second-largest economy in the world, cut interest rates and the required reserve ratios for Banks.

The European Eurofirst 300 index rose by 4.5%, heading towards its biggest gain in one day since May 2014. Stocks of the affected mining companies were the biggest gainers, as Glencore stock rose by about 9%, and Anglo American by more than 6%.

German bond yields - the standard for the euro zone – rose by more than ten basis points to the highest level in two weeks at 0.68 percent, while the American and British similar bond yields rose eight basis points to 2.08 percent and 1.89 percent respectively.

The US dollar continued its gains against most major currencies. It rose 1.3 percent against the yen, which is considered a safe haven and scored 119.96 yen, while the euro came down one percent to $ 1.15.

People’s Bank of China said on its website that the one-year lending rate will drop by 25 basis points to 4.6 percent effective Wednesday, while the one-year deposit rate will fall a quarter of a percentage point to 1.75 percent.

The bank added that it cut the required reserve ratio for most of the big banks 50 basis points to 18%. This decision becomes effective starting from next September 6.

The move coincides with a decline in Chinese stocks’ indexes by more than 7%, thereby recording its lowest since December, after falling more than 8% on Monday.

The Central Bank made a shock in the global markets when it devalued Yuan by about 2% on August 11. The bank described the move a reformation that flows in the direction of market liberalization, but some saw it as a beginning of a long decline in the currency to stimulate exports.