TOKYO (AP) -- Asian markets rebounded Monday, taking their cue from Wall Street's recovery late last week after the Federal Reserve cut a key interest rate.
The Tokyo benchmark index jumped 3 percent after ending last week with its biggest point drop in more than seven years.
The Nikkei 225 closed the day up 458.80 points, at 15,732.48 points on the Tokyo Stock Exchange, recouping about half of the 5.42 percent nose-dive racked up Friday - its largest single-day point loss since April 2000.
Australia's benchmark had its biggest one-day gain in almost a decade Monday as the benchmark S&P/ASX 200 surged 4.6 percent, or 261.6 points, to close the day at its peak of 5,932.6 points.
Other regional markets also recovered, as the Fed's move was viewed as a sign the U.S. is taking the recent market volatility seriously.
Benchmarks bounced back 2.3 percent in New Zealand, 5.7 percent in South Korea and 5.3 percent in Taiwan.
Analysts said it's too early to call whether the worst is over. Stock markets around the world have been on a skid since the U.S. subprime mortgage mess surfaced last month and spread.
A decision Friday by the Federal Reserve to cut its discount rate to 5.75 percent from 6.25 is helping calm some of the jitters. On Wall Street, stocks soared, and the Dow closed 1.82 percent higher at 13,079.08. Key indexes also rose in the U.K., France and Germany.
Michael Kurtz, a strategist at Bear Stearns Asia Ltd., said Asian economies are so dependent on the health of the American economy these days, any sign of danger in the U.S. economy is likely to rattle regional markets.
"Although Asian institutions appear in aggregate to have minimal direct exposure to U.S. subprime credit instruments, we think the region does remain hostage to any potential U.S. real-sector downside should U.S. mortgage problems magnify," he said in a report.
One remaining uncertainty is how widespread the damage from U.S. dubious lending is in Asia. It's not clear, for one thing, how exposed some hedge funds might be to such risky investments.
Even if regional financial organizations aren't directly exposed, indirect fallout could last for weeks, including market nervousness, economists say.
Japanese shares have taken an extra beating from the weakening dollar that has followed the subprime mortgage crisis. Many top Japanese companies are exporters that had been receiving a critical lift from a weak yen.
The dollar was trading at 114.66 yen midafternoon in Tokyo, up from 114 yen late Friday in New York.
Among recovering export Tokyo issues were Toyota Motor Corp., which rose 4.2 percent, Canon, which climbed 7.6 percent and Sony Corp., gaining 3.2 percent.
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