Hong Kong  - Hong Kong shares rebounded by nearly 3 per cent Thursday on the last day of trading before the Easter holidays, clawing back most of its losses from a day earlier.

The blue-chip Hang Seng Index rose by 426.55 points, or 2.95 per cent, to end the session at 14,901.41. Turnover was 52.6 billion Hong Kong dollars (6.78 billion US dollars.)

The spike in share prices came after China announced a scheme to allow for the yuan to be used to settle cross-border trade deals, opening the door to wider trade between Hong Kong and mainland China.

Hong Kong's chief executive Donald Tsang welcomed the move in a speech Thursday, saying it would boost the former British colony's banking sector and create more jobs.

A day earlier, Hong Kong shares fell by more than 450 points on worries over economic prospects and grim forecasts for the first quarter earnings of some major companies. (dpa)