HONG KONG - ASIAN markets rose on Monday after the US government proposed a US$700 billion (S$994 billion) plan to solve the world financial crisis by rescuing banks from billions of dollars in risky mortgage debt.

In Japan, the Nikkei 225 index climbed 1.4 per cent to close at 12,090.59 points , while Hong Kong's Hang Seng index rose 1.2 per cent.

In China, the Shanghai Composite Index soared 7.8 per cent on hopes of a turnaround after government steps to stabilize the country's beaten down shares. It jumped 9.5 per cent on Friday - its biggest one-day per centage gain ever.

Markets in Australia and Taiwan advanced strongly after regulators in both countries issued curbs on short selling, following similar moves in the US, Britain and other countries. The practice, which bets on a stock's decline, has been partly blamed for driving down share prices.

Global markets had rallied on Friday on news Washington was likely to announce a bailout plan, calming investors worried that losses from bad bets on mortgages could bring about the collapse of more companies, straining an already weakened financial system and global economy.

As a rough outline of the plan took shape over the weekend, the Bush administration continued to lobby lawmakers on Sunday for authority to use US$700 billion to buy up a mountain of bad debt at the heart of the crisis.

While the proposed bailout lifted sentiment for the time being, there were still a number of uncertainties about the plan and the general health of financial firms that could further unsettle markets in the coming days, an analyst said.

'This should stem the bleeding, but the patient is still very fragile,' said Thomas Lam, a senior economist at the United Overseas Bank in Singapore. 'The list of uncertainties is pretty long.'

Asian financial stocks, battered in recent weeks, were among the leaders.

Japanese banking giant Mitsubishi UFJ Financial Group Inc. shot up more than 5.2 per cent, while leading Australian firm Macquarie Group Ltd. climbed 5.3 per cent. In Hong Kong, Industrial & Commercial Bank of China, the country's biggest, was up 2.4 per cent.

In mainland China, share prices surge on strong buying of financial shares after the government announced plans to buy shares in major state-owned banks and other measures.

After watching share prices slide for almost a year, the government moved to support the stock market last week in response to the global financial crisis triggered by problems with bad debt in the US.

Comments by Premier Wen Jiabao over the weekend urging support for the financial system and market stability also boosted buying sentiment, analysts said.

'According to our analysis, this could be a turning point for the market, not just a brief rebound,' said Zhang Xiuqi, a strategist for Guotai Junan Securities in Shanghai. 'Market sentiment is finally recovering.'

The Shanghai benchmark still is down 57 per cent for the year.

Large-capitalised financial shares, airlines and gold miners were among the biggest gainers. Several major banks jumped by the 10 per cent daily limit, including ICBC, Bank of China and Construction Bank of China. PetroChina, the index's heaviest-weighted share, also surged 10 per cent.

Elsewhere, Australia's &P/ASX 200 index jumped 4.5 per cent and Taiwan's benchmark rose 2.3 per cent.

In Russia, stocks inched up following big gains for all indexes last week, with the U.S. dollar-denominated RTS adding 1.6 per cent.

The advances came after an another extraordinary rally on Wall Street on Friday. The Dow Jones industrials soared about 370 points, or 3.35 per cent, to 11,388.44, giving the index a gain of about 780 points over two days.

US stock index futures were down, though, suggesting Wall Street may open lower. The S&P 500 futures index was down 8.3 points, or 0.7 per cent, to 1,237.2.

Light, sweet crude rose 0.94 cents to US$105.49 a barrel in Asian trading on the New York Mercantile Exchange. The contract soared US$6.67 Friday.

In currencies, the dollar fell to 106.41 yen, while the euro rose to US$1.4507. -- AP

SINGAPORE

Singapore shares closed 0.58 per cent lower on Monday, losing earlier gains despite a US government plan to buy mortgage-related assets at the root of a global financial crisis, dealers said.

They said initial investor optimism over the bailout turned to pessimism.

The blue-chip Straits Times Index (STI) fell 14.94 points to 2,544.13.

The index had risen more than one percent in early trade.

Around 1.5 billion shares exchanged hands.

Losers beat gainers 276 to 260.

KUALA LUMPUR
Malaysian share prices rose 0.3 per cent higher on Monday as the US government moved to bail out troubled financial firms, dealers said.

The Kuala Lumpur Composite Index rose 2.92 points to close at 1,028.62.

HONG KONG
Hong Kong shares opened up 2.8 per cent on Monday, rallying on a Wall Street rebound last week after US authorities announced a massive federal bailout plan.

The benchmark Hang Seng Index jumped 541.29 points to 19,869.02.

SHANGHAI
Chinese share prices surged to close 7.77 per cent higher on Monday after China?s securities regulator announced plans for further stimulus measures to boost the stock market, dealers said.

The benchmark Shanghai Composite Index, which covers A and B shares, closed up 161.32 points at 2,236.41.

The Shanghai A-share index gained 169.46 points, or 7.78 percent, to 2,348.57 and the Shenzhen A-share index jumped 24.07 points, or 3.85 per cent, to 649.41.

TOKYO
Japanese shares closed up 1.42 per cent on Monday, down from early highs as markets digested a US plan to mop up Wall Street's billions of dollars of bad debt, dealers said.

Asia's largest bourse was cautious ahead of a national holiday in Japan on Tuesday and uncertainty over the 700-billion-dollar rescue plan to buy the toxic mortgage-related assets of US financial institutions, dealers said.

The Tokyo Stock Exchange?s benchmark Nikkei-225 index closed up 169.73 points to 12,090.59. The broader Topix index of all first-section shares rose 19.57 points or 1.70 per cent to 1,168.69. -- AFP, BERNAMA, REUTERS