Global stocks earned rise on Tuesday after the Federal Reserve said it would begin buying US companies’ debt. Overnight, US stocks reversed steep losses early in the session after the central bank said it would start buying the debt of US companies as part of efforts to support the economic recovery. The S&P 500 closed 0.8 per cent higher and the tech-heavy Nasdaq rose 1.4 per cent.

In a move that helped to ease investor concerns over coronavirus outbreaks in China and the US. investors are concerned that the flurry of new cases in China could result in new lockdowns, hitting the country’s economic recovery from the pandemic.

The Fed’s move to buy a diversified market index of corporate debt helped shift attention from concerns that rising Covid-19 cases in parts of the US and China.

Corporate debt helped shift attention from concerns that rising Covid-19 cases in parts of the US and China would thwart efforts to kick-start the world’s largest economies. The central bank plan, first announced three months ago, could help reduce borrowing costs for American businesses.

Fed chair Jerome Powell is due to deliver the central bank’s semi-annual monetary policy report to Congress on Tuesday.