China bounce, short-covering lift STI

EITHER China's reversal played a big part in triggering Tuesday's rebound or investors were betting that Greece exiting the eurozone will be no big deal. Or equally likely was that trading programs were indulging in large doses of short-covering in anticipation of the same on Wall Street on Tuesday.

Whatever the case, a large bounce in the three banks and Singtel proved instrumental in pushing the Straits Times Index up 37.15 points to 3,317.33, thus recovering almost all the 41 points lost on Monday.

Over in Hong Kong, the Hang Seng Index jumped one per cent; and in China, the Shanghai Composite Index gained 5.5 per cent. Volatility in China has spiked up over the past few days as the government has tried to stem a bout of selling in recent weeks with a slew of measures aimed at bolstering confidence - on Tuesday, the Shanghai index from low to high traversed about 11 per cent.