HONG KONG - Japanese stocks posted their biggest gain in nearly seven years Wednesday, leading other world indexes higher, as Asian officials sought to counter pessimism about prospects for markets and economic growth.
Japan's Nikkei 225 index vaulted 7.7 percent to 18,770.51, its biggest one-day rise since October 2008, when markets were volatile during the global financial crisis, and its 10th biggest gain since 1949. Other major Asian markets rose between 2 and 4 percent.
The strong gains come after three months of weakness in stock markets that was partly sparked by the dramatic sell-off in Chinese shares beginning in early June. Economic policy measures in China and Japan were positives for investors on Wednesday but there were also technical factors at work in the rebound, analysts said.
"Buoyant sentiments were in full display across Asia as regional bourses flashed green," said Bernard Aw, market strategist at IG in Singapore. "Risk is back in vogue and the European traders clearly embrace it as well," he said in market commentary.
European markets rose strongly in early trading. France's CAC 40 added 2.1 percent to 4,659.01 and Germany's DAX gained 1.7 percent to 10,447.69. Britain's FTSE 100 rose 1.8 percent to 6,255.42.
U.S. stocks were poised to open higher a day after posting their second biggest gains of the year. Dow futures were up 1.1 percent, while broader S&P 500 futures rose 1 percent.
The Nikkei, which had earlier hit its lowest level since February, bounced after comments from Prime Minister Shinzo Abe that raised expectations of more measures to shore up economic growth under his "Abenomics" stimulus program. The remarks gave an extra boost to Japanese stocks, which some analysts said were lagging behind the recovery this week on Wall Street and other global markets.
"The markets overnight looked much healthier while the Nikkei was still pointing in the wrong direction," said Ben Collett, head of Japan and Asian equities at Sunrise Brokers in Hong Kong. "The unsexy truth is that this is a lot of people moving to buy stock and not many sellers."
In written remarks from Abe read to a Bank of America-Merrill Lynch conference in Tokyo, the prime minister pledged to cut corporate tax rates by at least 3.3 percentage points next year. Passage of legislation making it easier to hire temporary workers and reports that Abe plans to keep his current economic team in a cabinet reshuffle next month also appeared to whet investor appetite.
China's Ministry of Finance helped with a new round of measures to revive growth.
The steps, which include infrastructure spending and reforming taxes for small businesses, follow other recent moves aimed at soothing jittery markets. A rebound in Shanghai shares Tuesday also reinforced faith in Beijing's interventionist policies to halt sliding prices.
Other Asian benchmarks ended with big gains. South Korea's Kospi added 3 percent to 1,934.20 and Hong Kong's Hang Seng climbed 4.1 percent to 22,131.31. The Shanghai Composite Index in mainland China rose 2.3 percent to 3,243.09. Australia's S&P/ASX 200 gained 2.1 percent to 5,221.10.
Some analysts said short-covering by traders, or buying shares to close out short positions taken on expectations a stock price will drop, was another factor behind the rally.
Gains were spread across sectors in Tokyo: medical technology company Terumo Corp. led with an 11.6 percent jump, toilet maker Toto Corp. soared 10.5 percent and Fuji Heavy Industries gained 9.2 percent.
In energy markets, U.S. benchmark oil was down 5 cents to $45.89 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 11 cents to close at $45.94 a barrel in New York on Tuesday. Brent Crude, a benchmark for international oils used by many U.S. refineries, rose 17 cents to $49.69 in London.
The dollar rose to 120.53 yen from 119.99 yen on Tuesday. The euro slipped to $1.1193 from $1.1214.