Japanese stocks recover after Wall St. surge
Japanese share prices recovered in Wednesday morning trading after a surge on Wall Street that came on hopes that a $700 billion bailout for the U.S. financial system will win legislative approval, CNN reported.
The benchmark Nikkei stock 225 index, which had lost 4.12 percent Tuesday, gained 166.82 points, or 1.48 percent, to 11,426.68 points after about the first half hour of trading.
It had closed at its lowest level in more than three years Tuesday on disappointment over the stalling of the bailout proposal.
The broader Topix index, which had tumbled 3.59 percent the previous session, was also back up, gaining 1.05 percent to 1,098.82 after about the first half hour of trading.
Investors were back snatching up bank shares, cheered by a recovery in U.S. shares and prospects that the bailout plan will pass later in the week.
The dollar's recovery, which tends to be a boost for Japanese shares, also encouraged buying. The dollar was trading at about 106 yen levels, up from about 104 yen earlier in the week.
Monday's plunge on the U.S. stock market came after the U.S. House of Representatives failed to pass the emergency bailout package, which would have allowed the government to buy bad mortgages and other sour assets held by troubled banks and other financial institutions.
On Monday in New York, the Dow Jones industrial average plunged 777 points, its biggest ever single-day drop, to 10,365.45. But investors were more optimistic about the prospects for the package Tuesday, sending the Dow Jones industrials surging nearly 500 points to the 10,860 level.