Asian markets rallied Wednesday after the U.S. Federal Reserve slashed two key interest rates -- the benchmark fed fund rate and the discount rate -- by 50 basis points each. Japan soared 3.7% and South Korea closed 3.5% higher.
The move was a bold bid to shield the world's biggest economy from a housing slump and financial turbulence, raising hopes that Asia's largest export market will be able to ride out turmoil in the credit market.
U.S. crude oil hovered within easy reach of a fresh all-time high of $82.38 set Tuesday as the rate cut eased worries of a sharp slowdown in the world's top
Bank shares, which had been battered by worries about a global credit shortage stemming from the U.S. subprime mortgage crisis, led gains, further propelled by better-than-expected results from Lehman Brothers . Lehman posted a 3.2% fall in quarterly profits but said the worst of the credit correction was over, sending its shares rocketing 10%. Australia's National Australia Bank, Singapore's DBS Group, South Korea's top lender Kookmin Bank and Japan's Mitsubishi UFG all gained ground.