TOKYO: Tokyo stocks rallied 1.80 percent by the lunch break on Tuesday as recently beaten-down exporters and financials rose amid hopes for action by eurozone policymakers to stabilise the debt crisis.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange, which fell 2.17 percent to close at a 30-month low on Monday, rose 150.43 points to 8,524.56 by the lunch break.
The broader Topix index of all first-section issues gained 11.70 points or 1.61 percent to 740.55.
"We've experienced these types of temporary rebounds many times before, with markets coming up for air after days of brutal selling," said Kazuhiro Takahashi, general manager of investment strategy and research at Daiwa Securities.
"And this will likely again be a short break before we see more evidence of progress in the Greek debt crisis," he told Dow Jones Newswires.
German Chancellor Angela Merkel is to hold talks with Greek Prime Minister George Papandreou in Berlin amid tentative signs of progress in overcoming Greece's crippling debt crisis.
Takahashi said investors were also watching whether the European Central Bank would cut interest rates when the bank holds a policy meeting on October 6.
Austrian central bank chief and ECB governing council member Ewald Nowotny said Monday that the ECB lowering its interest rate from the main 1.5 percent could not be excluded, as the eurozone faces an ongoing debt crisis and prospects of slower growth.
Japanese corporate earnings previews are also beginning to trickle in, Takahashi said.
"Near-term earnings will likely remain intact (compared with forecasts), though companies will likely sound a cautious tone for the rest of the fiscal year," he said.
Mitsubishi UFJ Financial Group rallied 3.03 percent to 339 yen and Sumitomo Mitsui Financial rose 2.74 percent to 2,134 yen. Sony went up 2.95 percent to 1,465 yen.
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