Japanese stocks rebound from worst crash since 1987 while global markets are mixed

Hong Kong/London CNN —

Japanese shares soared Tuesday, clawing back some of their record losses from the previous day and underpinning a patchy recovery on global markets.

The benchmark Nikkei 225 index finished 10% higher and the broader Topix closed around 9% up. Elsewhere in Asia, South Korea’s Kospi rebounded by 3.3%, while Taiwan stocks gained 3.4%. However, Hong Kong’s Hang Seng Index, which closed later,wasdown 0.3%.

Markets around the world plunged during Monday’s session when a combination of fears about a slowing US economy, rising Japanese interest rates and crumbling tech stocks combined to trigger a meltdown.

Although stocks in Europe also recouped some of their losses in early Tuesday trade, they ticked down by late morning. The Stoxx 600 index, the region’s benchmark, was trading 0.3% down on the day by 5.53 a.m. ET, having lost 2.2% the day before. London’s FTSE 100 edged 0.3% lower by the same time.

US stocks were set to open higher, with futures contracts climbing in pre-market trade. S&P 500 futures were up 0.4% and Nasdaq futures up 0.3%.

The bounce in Japan is “typical after a market crash,” Neil Newman, head of strategy at Astris Advisory in Tokyo, told CNN. “Importantly: Fundamentals are sound, the economy is doing fine, there is no evidence of abandoning Japanese equities.”

But short-term volatility in the stock market remains as the market believes the US dollar has not yet stabilized against the Japaneseyen, analysts from UBS Chief Investment Office wrote in a research report Tuesday.

“It is too early to conclude that the Japanese stock market has hit a bottom,” they said, adding that any recovery would likely only occur after Japanese companies report first-half earnings in October, or