Japan index sees stocks rebound

Japan index sees stocks rebound

Trading room in Tokyo, 29 October 2008
Tokyo saw clear gains

Stocks in Japan have rebounded, with the Nikkei seeing a rise of 6.4% by the end of the morning session.

In South Korea, there has been a similar gain, with the Kospi shooting up more than 7%, although it fell back slightly later.

The gains came after Wall Street ended Tuesday with a 10% surge.

Analysts said investors were buying in anticipation that the Federal Reserve would cut interest rates on Wednesday, with a half-point cut to 1% predicted.

In Tokyo, the Nikkei-225 finished the morning at 8,109.34, a gain of 487.42 points.

There are also hopes that interest rates will be cut by the Bank of Japan.

Meanwhile, companies which are highly dependant on export earnings - like camera maker Canon, saw their share price rise on the back of a weakening yen.

It was trading at 97.13 to the US dollar, falling back from a 13-year high last week.


On Tuesday, New York's Dow Jones index closed ahead 889.35 points, or 10.88% at 9065.12. The tech-based Nasdaq also closed up 9.53%, and the broader S&P 500 was ahead 10.79%.

A trader on the New York Stock Exchange reacts to the high close (28 Oct)
The stock market boost came after a previous drop of 500 points

That was the Dow's second biggest one-day points gain ever, after dropping 500 points on each of the two previous trading days.

Volatility has been the watchword over the past few weeks - out of 20 trading days there have been only two where the Dow did not close up or down by triple digits.

Shares of aircraft maker Boeing were up 15% to $48.91 after the manufacturer reached a provisional deal with its largest union to end a strike and end losses put at $100m (£64m) a day.

Earlier on Tuesday, in London, the FTSE closed up 73.79 points, or 1.9%, at 3,926.38 while in Paris the Cac 40 gained 47.57 points, or 1.6%, to end at 3,114.92.

Frankfurt's Dax rose 485.81 points, or 11.3%, to 4,823.45.

In Germany, the Dax was mainly boosted by Volkswagen, whose shares have soared since Porsche announced on Sunday that it had upped its VW stake. This has caused investors to scramble for the remaining VW shares in the market.

As a result, VW - Europe's largest carmaker - was the clear winner on the German index, finishing the day up 81.7% at 945 euros.

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