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TOKYO - JAPAN'S Nikkei stock index rose more than two per cent in early trade on Thursday as investors pinned their hopes on economy-boosting measures in the United States, analysts said.
The benchmark index gained 204.98 points, or 2.50 per cent, to 8,418.20 in the first hour of trading.
The Dow Jones Industrial Average climbed 2.91 per cent on Wednesday, shaking off a series of gloomy economic reports and extending a bargain-hunting rally amid signs that a global credit crunch is easing.
Mr Kazuhiro Takahashi, equity trading information head at Daiwa Securities SMBC, said investors were 'looking ahead rather than the shaky ground at their feet.'
Share prices got support from 'expectations for future economic policies' under US president elect Barack Obama rather than being dragged down by the current gloom, he said.
The market welcomed Mr Obama's appointment of former Federal Reserve chairman Paul Volcker as head of a new panel of advisers to steer the US economy back to health, Mr Takahashi said.
'He is a heavyweight. The appointment capped the impression that Obama has a strong economic team,' he said.
Other supportive factors were a steep rate cut by China and a 200-billion-euro (259-billion-dollar) economic stimulus package unveiled by the European Union, he said.
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