Stocks this morning: Japan stocks rise almost 3%

TOKYO -- Asian stocks rebounded Friday from the previous day's rout, with Tokyo's index gaining nearly 3%, as the U.S. bailed out Bank of America again and a weaker yen lifted exporters like Toyota Motor Corp.

After a tumultuous week that saw markets fall sharply, early trade was cautious but picked up later in the day as investors snapped up beaten down shares.

While still wary of more trouble ahead amid the global downturn, investors were cheered by signs the U.S. government would do whatever is necessary to prevent its economy from sinking deeper into recession.

"The market was overdone, extremely oversold, we're having a technical rebounds of sorts. However, the economic fundamentals are still poor," said Alex Tang, head of research at Core Pacific-Yamaichi International in Hong Kong. "Investors are hoping the stimulus will work, but it will take time. A U.S. recovery isn't going to materialize for some time."

In Japan, the Nikkei 225 stock average added 206.84 points, or 2.6%, to 8,230.15 as automakers and other exporters gained. Toyota, which said Thursday it was making further production cuts in North America, jumped 6%, and Honda Motor Co. vaulted 8%. Electronics maker Nikon rose 6.7%.

Hong Kong's Hang Seng edged higher 12.55 points, or 0.1%, to 13,255.51 and in mainland China, the Shanghai Composite Index climbed 1.8%. Benchmarks in South Korea, Singapore, Australia, Taiwan and India also advanced.

Early Friday in the U.S, Bank of America and the Treasury Department reached an agreement for an additional $20 billion in fresh capital from the federal government's emergency rescue fund, plus guarantees against losses on up to $118 billion in troubled assets. The bank was to use the aid to help it absorb losses from its acquisition of faltering investment bank Merrill Lynch.

The deal came just hours after American lawmakers authorized a second $350 billion from the government's bailout fund amid mounting speculation that debt-laden banks would need even more rescue money. Meanwhile, allies of President-elect Barack Obama unveiled an $825 billion recovery bill — two-thirds spending and one-third tax cuts — to help jump-start the world's largest economy.