Asian markets rebound after global rate cuts

Asian markets bounced back modestly on Thursday after major central banks around the world slashed interest rates to ease the global credit
crunch, although fears of further turmoil kept investors jittery.

South Korea, Hong Kong and Taiwan lowered their interest rates, joining a series of cuts Wednesday in the US, Europe and China aimed at stabilizing global markets that have plunged sharply this week.

Japan's benchmark Nikkei 225 index was up 2.1 per cent to 9,397, a day after it plummeted 9.4 per cent in its biggest one-day drop since the 1987 market crash.

Hong Kong's Hang Seng Index jumped nearly 3 per cent to 15,871 after the territory cut interest rates for a second day. And a surprise rate cut in South Korea also cheered investors, who lifted the Kospi index 1.8 per cent.

Mainland China's main index was up 0.6 per cent after its central bank lowered rates Wednesday evening.

China's move came as six other central banks, including the US Federal Reserve and European Central Bank, joined to lower rates to contain the spreading financial crisis. Japan's central bank, constrained by already-low rates, said it backed the moves.

``Investors bought back shares as sentiment slightly improved on measures including coordinated rate cuts,'' said Kazuhiro Takahashi, general manager at Daiwa Securities SMBC Co Ltd in Tokyo.

Investor reaction in Asia to the string of moves was more positive than in the US and Europe, where an initial perk in markets soon dissipated amid severe stresses in lending markets and worries about a global recession.

Sorce: EconomicTimes