Asian stocks had a jittery session Thursday with markets dipping in and out of negative territory as fears of a possible downgrade of U.S. bond insurers hit financials. Both Japan and South Korea finished higher despite a negative start to the session.
The Dow initially rallied after the Federal Reserves 50 basis point interest rate cut Wednesday, but lost momentum in the final hour after CNBC reported that two big bond insurers were facing possible downgrades.
The Nikkei 225 Average finished 1.85 percent higher, buoyed by short-covering in Toyota Motor and other blue-chip exporters, while banks erased nearly all
their losses as subprime fears eased slightly.
South Korea's KOSPI closed 2.2 percent higher, bouncing from the prior day's nine-month closing low, as Hyundai Heavy surged on strong earnings and share buybacks, while Samsung Electronics rose after settling patent disputes. But SK Telecom, South Korea's top mobile carrier, dropped 1.6 percent after it reported a sharper-than-expected 76 percent fall in quarterly profit, dented by marketing costs.