BEIJING, Oct 20: The worst financial crisis in decades is slowing China’s growth, the government said on Monday, as gloomy news from other nations deepened worries about a worldwide recession.

Most Asian markets were higher but analysts put much of the gain down to bargain-hunting, with investors taking advantage of low stock prices battered in the recent turmoil but still worried about the outlook in the months ahead.

China’s growth slowed to 9 per cent in the third quarter, the first time the country’s red-hot economy has posted only single-digit growth in four years, and officials said the global crisis was to blame.

“The growth rate of the world economy has slowed down noticeably. There are more uncertain and volatile factors in the international economic climate,” said Li Xiaochao, spokesman for the National Bureau of Statistics.

“All these factors have started to release their negative impact on China’s economy,” Li said.

Meanwhile, the head of Japan’s central bank said his country’s economy, the second-biggest in the world, was expected to remain sluggish.

“Looking ahead, it is highly probable that the economy will remain stagnant as it has become clear that overseas economies continue to slow down,” Bank of Japan governor Masaaki Shirakawa said.

His comments followed US data on Friday that new home starts in the United States -- one gauge of the health of the world’s biggest economy -- had fallen to their lowest level since the recession in 1991.

Despite the string of gloomy news, most Asian stock markets were up and major European markets also opened ahead.

Japan finished the day up 3.59 per cent, Australia gained 4.3 per cent and Hong Kong was 4.3 ahead at the midday break.

As Europe’s trading day opened, London was 0.79 per cent ahead, the CAC 40 in Paris was up 2.28 per cent and Frankfurt’s Dax gained 2.3 per cent.

Dealers said some investors were cheered by the weekend announcement that US President Bush and European leaders have planned several summits to address the worst financial crisis since the Great Depression.

The proposed summits have “contributed to creating a climate in which investors can have positive expectations,” said Kazuhiro Takahashi, general manager at Daiwa Securities SMBC in Japan.

But he cautioned: “Markets are still surrounded by uncertainty.” The first summit, expected to be held soon after the US presidential election on November 4, will try to find common ground on reforming the international financial system put in place in World War II.

Sarkozy and other European leaders have been urging a broad overhaul of the so-called Bretton Woods system, including greater international oversight -- a move Bush said should be treated with caution.—AFP