U.S. stocks surged on Friday, with the Dow Jones Industrial Average soaring over 160 points, after China announced its first interest rate cut in more than two years. Global stock markets also received a boost after the European Central Bank said it would take action to stimulate its struggling economy with more asset purchases.

The People’s Bank of China cut benchmark interest rates to lower borrowing costs in an attempt to offset a slowdown in economic activity. The 12-month lending rate will fall by 40 basis points to 5.6 percent and the 12-month deposit rate will decline by 25 basis points to 2.75 percent, effective Saturday.

“The impact on GDP growth will be small. The main effect will be to improve the financial position of large firms. At the same time, the wide net interest margins enjoyed by banks will be squeezed,” Mark Williams, chief Asia economist at Capital Economics, said in a note Friday.

The ECB said it plans to ramp up stimulus as Europe titers on a triple-dip recession following the Eurozone’s weak economic outlook and deflationary concerns. “We will do what we must to raise inflation and inflation expectations as fast as possible, as our price-stability mandate requires,” ECB president Mario Draghi said at a conference in Frankfurt Friday.

The Dow Jones Industrial Average, which measures 30 large industrial stocks, soared 160.61 points, or 0.91 percent, to 17,879.61; the S&P 500 Index fell 17.59 points, or 0.86 percent, to 2,070.34. The Nasdaq Composite declined 37.64 points, or 0.80 percent, to 4,770.97.