Investors in Asia were scrambling back into technology shares after an overnight report from IBM that its profits were on target. Further inspiration came from Nasdaq's strong performance, which has raised hopes in Asian markets that the worst is over for high-tech stocks.
Foreign funds provided much of the drive as they went bargain-hunting among the region's chipmakers, sparking rises of up to 5% among the region's technology leaders. Tokyo enjoyed its fifth day of gains, powered by a weakening yen, which hoisted stocks of exporters, and expectations that a government market support strategy is about to be unveiled.
The Nikkei 225 Average climbed more than 1.5%, adding 187.63 points to 13,855.26, led by chips giant NEC and electronic consumer goods group Sony. Bank stocks were also being snapped up on expectations that a government share support scheme would take the pressure off their balance sheets, which are stuffed with stocks.
Hong Kong stocks accelerated and the Hang Seng climbed 218.64 to 15,480.12. Technology stocks were lifted by Nasdaq's performance but buyers were also snapping up interest-rate sensitive counters such as banks and property developers on the belief that the recent economic indicators from the US had cleared the way for further rate cuts.
The hammering of telecommunications carrier Pacific Century Cyberworks ended, removing some of the negative pressure on the Hang Seng. Heavy buying of South Korean chipmakers, led by foreign institutions, boosted prices in Seoul almost 2%.
Samsung Electronics, which counts IBM as a major customer, jumped more than 5%, and as the New Year rally continued to spread into other sectors the Kospi gained 11.04 points to 606.87, taking it past the critical 600 support level.
An early sprint by bank and financial stocks in Taiwan slowed to a jog by midday when the Weighted index closed the session up 34.95 points at 5804.90.
Trading was subdued by the coming 10-day Chinese New Year holiday, but buyers snapped up bank stocks on the conviction that the shake-out in the sector had been overdone.
A rush from blue-chips into technology stocks left Singapore's Straits Times index down 14.44 points at 1892.74. IBM's bullish report sparked the technology rally, but concerns over the trade figures and the longer-term economic outlook proved the bigger influence.
A mild adjustment to Malaysia's Cabinet by Prime Minister Mahathir Mohamad had no economic implications, and as investors held back in expectation of the heavyweight offering of stock in Time dot com, the Kuala Lumpur Composite edged down 0.79 to 678.86.
Continued buying of bank stocks, and a sharp rally in technology counters combined to push Thailand's SET index up by 3.75 points to 318.73.
With the smell of teargas still strong after student rioting continued in Jakarta, the Composite index drifted down 0.07 points to 414.59.
Strong overnight buying of News Corp's ADRs in New York followed through in Sydney, pushing the stock up 1.2%, and helping the All Ordinaries index up 44.7 points to 3243.1.