Tokyo  - Asian stocks bounced up Thursday as investors were cheered by news from Japan, where the government prepared to unveil a 154-billion-dollar economic stimulus package and its machinery orders unexpectedly rose.

Japan's benchmark Nikkei 225 Stock Average surged 3.74 per cent to 8,916.06, a day after falling 2.69 per cent on concerns over upcoming corporate earnings reports. Thursday's gains erased the Nikkei's losses for the year.

Japan's broader Topix index of all first-section issues also rose 3.26 per cent to 841.81.

The day's biggest gains were seen in South Korea, where the benchmark Kospi index soared 4.3 per cent, and Taiwan, where the Taiex surged 4.12 per cent.

Hong Kong's Hang Seng Index rose 2.95 per cent to 14,901.41 while Australia's ASX 200 was up 1.44 per cent at 3,671.6 despite it reporting the biggest jump in its unemployment rate in 18 years in March.

The gains were seen on the day Japanese Prime Minister Taro Aso vowed to create 1.4 million to 2 million new jobs in the next three years to pull the world's second-largest economy out of its worst recession in the postwar era as his government prepared to unveil a stimulus package of 15.4 trillion yen, or 3 per cent of Japan's gross domestic product, in legislation Friday.

The package would be Japan's third stimulus since the fall.

Optimism was also seen after the government reported machinery orders were up 1.4 per cent in February from the month before to 728.1 billion yen (7.28 billion dollars). The increase was the first in five months and gave rise to hopes that capital investment is returning and the recession might let up.

The increase was better than the average market expectation for an 8.1-per-cent fall.

The government also revised its assessment on machinery orders upward for the first time since May 2007 but said it remained cautious about the recovery of the nation's economy as overseas machinery orders and orders in the manufacturing sector were still low.

Seoul's Kospi jumped to 1,316.35 on the central bank's decision to freeze its key interest rate for the second-straight month and expectations for better corporate earnings ahead.

Taipei's Taiex surged to a six-month closing high at 5,667.8 on reports of continued rush orders from China received by local technology firms and the government's multibillion-dollar plans to boost tourism and local infrastructure projects.

Stocks in Hong Kong spiked after China announced a scheme to allow for the yuan to be used to settle cross-border trade deals, opening the door to wider trade between Hong Kong and mainland China.

On the mainland, the Shanghai Composite Index was up 1.38 per cent to 2,379.88 while the Shenzhen Composite Index rose 1.62 per cent to 793.13.

In India, where stocks bucked Wednesday's falls across the region, increases were more muted. The Bombay Stock Exchange's 30-share Sensex index was up 0.67 per cent to 10,814.76 while the National Stock Exchange's broader 50-share Nifty increased 0.09 per cent to 3,346.05.

Vietnam was the only Asian market to see decreases while in other parts of South-East Asia, Singapore's Straits Times Index was up 2.5 per cent to 1,828.51, the Stock Exchange of Thailand Index rose 0.16 per cent and the Kuala Lumpur Composite Index saw a 1.1-per-cent rise. (dpa)