Stockmarkets are rejoicing. As Hong Kong’s market reopened on October 2nd after a public holiday, shares rose by more than 6%, capping a rally of over 20% in a mere six frenetic trading days. But China will need even more stimulus to escape from its deflationary trap.

China's $114 billion stimulus has some investors excited, but it's lacking support for the country's discouraged consumers.

Analysts say the difficulty for Chinese policymakers will be turning the opportunism-fueled rally into a broader recovery when markets reopen after the Golden Week holiday.

The interest rate cuts and further economic stimulus announced last week by Chinese authorities continue to boost the stocks representing interests in that nation.

Getting out of the deflationary hole China dug itself is vital, and in the short run all stimulus will help. But for the long term, China needs to stop digging and start consuming.

For banks, the lower mortgage rates could hurt profits in the short term. China’s drastic fiscal stimulus measures could revive an economy weighed by weak domestic spending and a troubled real estate sector,