Tokyo stocks surge more than 6 per cent

illustration photo

The Nikkei added 536.00 points to 9,141.15. The Bank of Japan pumped another 3.5 trillion yen ($43.3 bln) into the financial system, after offering eight trillion in same day funds Tuesday and a record 15 trillion on Monday to soothe markets and ensure firms can access cash.

"There appears to be some buying back by hedge funds following yesterday's panic-selling," Cosmo Securities equity strategist Toshikazu Horiuchi told Dow Jones Newswires.

"But unless the nuclear power plant issues are resolved, the reconstruction efforts will not be able to start and only then can we gauge the impact (of the earthquake) on earnings," he adds.

Japanese shares dived Tuesday on a wave of panic-selling after Prime Minister Naoto Kan warned that radiation leaked from a quake-hit nuclear plant had reached levels that posed a threat to health.

It was the biggest one-day fall since the Lehman crisis in 2008 at the beginning of the global financial crisis, compounding Monday's 6.18 per cent tumble.

Japanese stocks soared Wednesday despite a fresh fire and fears that containment pools holding spent fuel rods at reactor four had started to heat up.

If the water in the deep pools evaporates, this would expose the fuel rods to the air, destroying them and releasing radioactive material into the atmosphere.

Exporters were higher after being dumped on output concerns.

With rolling power cuts planned for Japan, companies from big producers to suppliers of key components have shut plants. World markets tumbled Tuesday on fears for the global supply chain.

On Wednesday Toyota Motor was up 9.46 per cent at 3,355 yen. Sony gained 7.91 per cent to 2,508. Tokyo Electric Power, or TEPCO, the operator of the stricken Fukushima nuclear power plants, remained ask-only at 1,041.

Tohoku Electric Power was up 8.85 per cent at 1,291. Dai-ichi Life Insurance surged 12 per cent 133,900.

The yen softened slightly to 81.08 against the dollar from 80.78 in New York late Tuesday.