Japanese shares surged more than 4 per cent today to their biggest one-day gain in nearly six years.
The benchmark Nikkei closed up 4.1 per cent, and the broader Topix finished up 4.7 per cent, both marking their biggest one-day gains since March 4th, 2002 - when both surged on a government crackdown on short sellers.
Shares were lifted by a growing confidence that a US tax rebate and bond insurer rescue will have a positive impact.
Banks in particular surged, with Mizuho Financial Group up 10.89 per cent, its biggest one-day gain since September 2003. Non-life insurers such as Millea Holdings also jumped.
A weaker yen against the dollar boosted Nissan Motor Corp and other blue-chip exporters.
In three consecutive positive days the Nikkei has recouped 7 per cent of its losses for this year, though it still is down roughly 11 per cent. On Tuesday it had its biggest one-day loss since the session just after the September 11th, 2001, attacks in the United States.