Asian markets ended a volatile week with a firm rally on Friday, which brought most of the major indexes back to Monday's opening levels. A U.S. tax stimulus package, reassuring jobs data and the prospect of another Federal Reserve rate cut buoyed investor sentiment on Wall Street, which then boosted the Asian session. Hong Kong and Bombay stock indexes both gained over 6 percent in the late flourish.
Financial counters moved forward. Banks, such as Japan's Mitsubishi UFJ Financial Group and
Australia's Macquarie Group shrugged off news that a trader at Societe Generale was accused of racking up a $7 billion loss in bad bets on stocks in the biggest trading scandal in banking history. The financial sector also drew support from news that troubled U.S. bond insurer Ambac may be in talks with a buyer.
Australia's S&P/ASX 200 Index notched its biggest one-day percentage gain in over a decade -- closing up 5 percent -- extending their rebound to a third day and recouping all the week's losses, as banks and resource stocks rose on hopes the U.S. could escape a recession. Optimism that strong Chinese growth would help to offset a U.S. slowdown also bolstered sentiment in Australia, which has been feeding as much raw materials as possible into the booming Chinese economy. BHP Billiton, the world's biggest miner and its takeover target Rio Tinto surged, helped by higher metals and oil prices.
In Tokyo, the Nikkei 225 Average surged more than 4 percent to its biggest one-day gain -- over 500 points -- since March 2002, as relief over a U.S. tax plan and a possible rescue of U.S. bond insurers set off a wave of short covering. Japan's No 2 bank, Mizuho Financial Holdings jumped nearly 11 percent, its largest one-day gain since Sept 2003, with other banks also doing well. Exporters gained on a weaker yen .
South Korea's KOSPI gained for a third day in a row, rising 1.8 percent on hopes a U.S. economic stimulus plan would help avert a recession in South Korea's No. 2 export market, while strong results lifted Kia Motors.
Hong Kong stocks ended with gains of 6.7 percent as a rally on Wall Street buoyed investor confidence, prompting buying across the board, with Bank of Communications outperforming after a broker upgrade. Other China names, which had been beaten down early this week, also posted hefty gains, with oil producer PetroChina gaining 8.6 percent.
Singapore's FTSE Straits Times Index closed 3.6 percent higher, led by gains in financial stocks such as Singapore Exchange and United Overseas Bank.
China's Shanghai Composite Index was the weakest amongst the Asian benchmark indexes, but managed gains of 0.9 percent.