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Asia Ends With Gains; Nikkei Rises 2.3%

The Associated Press

TOKYO -- Asian stocks followed Wall Street sharply higher Tuesday, invigorated by fresh hopes for improved bank earnings and signs the regional economy is recovering.

The upbeat mood permeated the entire region, with financial stocks leading the gains. Oil climbed back above $60 a barrel after dropping sharply over the past week on concerns about weak global growth.

Japan's benchmark Nikkei 225 stock average rose 2.3% to close at 9,261.81, erasing most of the previous day's decline. Hong Kong's Hang Seng advanced 3.7%.

Elsewhere, South Korea's Kospi gained 0.5% and China's Shanghai index finished higher by 2.1%.

The figures added to optimism following a strong showing Monday in New York, where the Dow Jones Industrial Average jumped more than 2%.

Rising bank stocks propelled U.S. indexes to their biggest one-day gain in six weeks Monday after influential banking analyst Meredith Whitney raised her rating on Goldman Sachs (GS Quote) The bank reports earnings on Tuesday.

"Investors were looking for buying cues," said Seiichi Miura, an equity strategist for Mitsubishi UFJ Securities in Tokyo. "So the gains overnight on Wall Street and the positive comments about Goldman Sachs provided that incentive."

Miura said further moves will depend on second-quarter results this week from Goldman and other financial giants -- Bank of America(BAC Quote), JPMorgan Chase(JPM Quote) and Citigroup (C Quote) -- as well hundreds of earnings reports from other sectors.

Financial stocks throughout the region climbed, with Nomura(NMR Quote), Japan's biggest securities company, surging 6.9%.

Japanese automakers also gained after the Nikkei financial daily reported that Nissan (NSANY Quote) and Honda(HMC Quote) are boosting production capacity in China. Nissan surged 7.3%, and Honda was up 2.7%.

In New York on Monday, the Dow rose 185.16, or 2.3%, to 8,331.68. The broader S&P 500 index jumped 21.92, or 2.5%, to 901.05, its first finish over the 900 mark since July 1. It was the S&P's best day since June 1.

Wall Street futures pointed to a mixed opening Tuesday.

Stocks in London, Frankfurt and Paris were trading slightly higher.

Oil prices climbed Tuesday, with benchmark crude for August delivery up 80 cents to $60.49 a barrel. The contract fell 20 cents to settle at $59.69 on Monday.

The dollar strengthened to 93.07 yen from 92.97 yen late Monday, while the euro traded at $1.3990 from $1.3976.