TSX, Dow stabilize ahead of market shutdown in China

Stocks in North America halted their rout on Wednesday, anticipating a reprieve from bad news about China as its markets will be closed for the next two days.

New York stocks powered higher, encouraged by a positive jobs report and more signs of economic expansion out the the Fed Beige Book.The Dow was up 293 points at the close at 16,258 and the broader S&P 500 index soared 35points higher at 1,948.

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Oil moved higher, with theWest Texas Intermediatecontract up 67cents at $46.08US a barrel.

This morning, U.S. data showed oil stocks expanded by 4.67 million barrels in the U.S. after refineries shut down for maintenance. That sent oil briefly below $45 before it recovered in the afternoon.

Global stocks have been in a rout the last two days amid concerns that a slowdown in China will hamper growth around the world.

Disappointing manufacturing data from the United States and China that emerged on Tuesday contributed to further volatility on Asian markets Wednesday. A U.S. manufacturing index hit its lowest level in two years and the PMI index out of China showed the sector there is sinking.

The Shanghai Composite Index in mainland China fell as much as 4.4 per cent in early trading, before climbing back to end up with two per cent loss at 3,105.13. Hong Kong's Hang Seng dropped 1.1 per cent, but Japanese stocks moved higher.

2-day holiday in China

Chinese markets will be closed the next two days because of a special holiday to mark the 70th anniversary of the surrender of Japan at the end of the Second World War.

A pessimistic assessment of the global economy by International Monetary Fund managing director Christine Lagarde helped European stocks start the day lower.

In a speech in Indonesia, Lagarde said Asia is still expected to lead global growth, but the pace is slowing and could sag furtherbecause of recent financial market volatility.

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"Overall, we expect global growth to remain moderate and likely weaker than weanticipated in July," Lagarde said.

But European stocks recovered in later trading encouraged by the EU's lower unemployment levels and prospect of a respite from Chinese news.

In North America, markets are anticipating the release of employment numbers from both the U.S. and Canada on Friday.

In advance of official data, payroll processor ADP reported that businesses added 190,000 jobs in June, suggesting that hiring continues despite the turmoil in the stock market.

The Fed Beige Book, a collection of minutes from Fed officials around the country, came out in the afternoon. It showed tighter labour markets and an expanding economy in many regions of the U.S., which could mean the Fed is closer to raising rates.