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(Bloomberg) — Asian stocksled a rally in riskier assets, climbing with U.S. index futures, oil and high-yielding currencies as China refrained from further cuts to the yuan’s reference rate and scrapped a system of market circuit breakers, providing some reassurance to investors.

Shares in Hong Kong and Japan rose for the first time in five days, helping the regional benchmark trim its worst weekly rout since 2011, while those in Shanghai fluctuated between gains and losses amid a second day of offshore gains in the yuan. Standard & Poor’s 500 Index futures jumped 0.9 percent. The Korean won and Australian dollar led currency gains as U.S. crudeoil rallied toward $34 a barrel after sliding to a 12-year low last session. Haven assets succumbed, with the yen, gold and government bonds retreating.

More than $2 trillion has been erased from the value of global equities this week as the new year kicked off with a renewed bout of concern about China. The country abandoned a circuit-breaker system aimed at stymieing a stock rout after it was triggered by selloffs twice this week and baffled investors with a seemingly contradictory approach to the yuan, fueling greater anxiety over policy makers’ abilities to manage the slowing economy. The tumult in China came as oil’s drubbing stokes a separate set of concerns: over the prospect for global disinflation and its potential impact on central bank policy.
“There was a bit of relief because the fixing was little changed, but it’s not fundamental,” said Thebes Lo, vice president at Kim Eng Securities Ltd. in Hong Kong. “After such a big correction in global equities, some hedge funds are taking profits off the table first. Given the deteriorating economy in China, the government do not want to risk any social unrest so they’re trying to comfort investors as much as they can in the near term.”

The People’s Bank of China set the yuan’s daily fixing, which restricts onshore moves to a maximum 2 percent on either side, at 6.5636 per dollar, just 0.02 percent stronger than Thursday’s rate. The announcement triggered a revival in the fortunes of Asian stocks, with the MSCI Asia Pacific Index reversing declines of as much as 0.4 percent.

The tumultuous start to 2016 has traders and analysts second-guessing their predictions for the year, with U.S. equities also posting their worst four-day annual start ever last session. The current challenges faced by markets are akin to those seen during the 2008 global financial crisis, according to billionaire investor George Soros, who told an economic forum in Sri Lanka Thursday that China’s problems are being transferred to the rest of the world.

“They are trying to set some calm in the market,” said Angus Nicholson, a market analyst at IG Ltd. in Melbourne. “Risk assets are back on and that’s what markets wanted to happen. They want the Chinese government to get heavily involved, stopping the weakening of the currency. This should bring an element of calm to markets.”

–With assistance from Adam Haigh.

To contact the reporters on this story: Emma O’Brien in Wellington at eobrien6@bloomberg.net; Anna Kitanaka in Tokyo at akitanaka@bloomberg.net To contact the editors responsible for this story: Emma O’Brien at eobrien6@bloomberg.net John McCluskey