Japan's Nikkei index jumps 5.8 percent

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Japan's main stock index jumped nearly 6 percent Monday, as investors shrugged off gloomy economic data and focused instead on the weaker yen, China's new economic stimulus package and last week's late gains on Wall Street.

The Nikkei 225 stock average vaulted out of the starting blocks, gaining over 500 points in the first hour of trading, then maintained the gains throughout the day. The Nikkei ended up 5.8 percent, or 498.43 points, at 9,081.43, ending a two-session skid.

Monday's strong showing came despite the release of data suggesting a major decline in corporate spending. Japan's core machinery orders dropped 10.4 percent in the July-September quarter from the previous three months, matching the biggest plunge on record, according to data released by the Cabinet Office before trading began.

"Machinery orders were within expectations, and it looks like they will pick up in the next quarter. Investors were more focused on U.S. shares and the yen," said Yutaka Miura, a senior strategist at Shinko Securities Co.

On Friday, Wall Street ended two days of losses as buyers sought out bargains, sending the Dow Jones industrial average up or 2.85 percent, or 248.02 points, to 8,943.81. The broader S&P 500 index also ended higher.

Buying was also spurred by China's Sunday announcement of a $586 billion stimulus package, the biggest move so far by the world's fourth-largest economy to mitigate the effects of the global financial crisis.

"Investors welcomed China's stimulus package. The size of the package was impressive, and investors took heart from China's resolve to tackle the global financial crisis," said Kazuhiro Takahashi, equity strategist at Daiwa Securities SMBC Co. Ltd.

China's export-driven economy is starting to feel the impact of the global slowdown, and the government has already cut key interest rates three times in less than two months in a bid to fend off the knock-on effects of the global financial crisis.

In a positive sign for Japan's major exporters, the yen continued to weaken against the dollar on Monday in Asia. The currency stood at 99.05 to the dollar Monday afternoon in Tokyo, compared with 98.21 in New York late Friday.

Shares in many big-name companies had strong showings Monday. Electronics icon Sony Corp. rose 7.6 percent to 2,345 yen, and fellow electronics heavyweight Sharp Corp. was up 7.3 percent at 764 yen. Mitsubish Heavy Industries gained 6.3 percent to 391 yen.

Sanyo Electric Co., the struggling electronics maker that Friday said it was in talks with Panasonic on a buyout deal, plunged 6.9 percent to 189 yen. Panasonic nudged up 0.8 percent to 1,889 yen.

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