Stock prices soared in New York late Tuesday as the Dow Jones Industrials gained 889 points or 11 percent on the day. Asian stock indexes soared in early trading Wednesday, following large gains Tuesday in New York and other stock markets. VOA's Barry Wood has more.

Most of the advance came in the final hour of trading. Broader indexes, including the Standard and Poors 500 and the Nasdaq, were also sharply higher. Stocks were rebounding from their lowest price earnings ratios in 23 years as investors concluded that US equities are now undervalued.

Steven Leuthold is a money manager in Tucson, Arizona.

"I don't know. It is a bottoming zone," said Steven Leuthold. "The market is really cheap on a valuation basis, around the 15th percentile. So it's a cheap market. And I think we're really coming out of the woods a little bit in terms of the whole liquidity thing."

Stock markets around the world have been extremely volatile for past six weeks as more than $12 trillion of market value has been lost.  Tuesday's advance started in Asia as Hong Kong shares were up 14 percent - their best advance in 11 years, Germany was up 11 percent and Brazil 13 percent.

The US market advanced despite a report that consumer confidence plunged in October. Worried consumers are cutting back on spending and fearful of losing their jobs. They are similarly concerned about falling home and stock prices,

Columbia University professor Rick Mishkin-until recently a Federal Reserve Board governor-says credit markets must return to normal before the US economy can resume growing.

"If credit markets stabilize and start working again the economy will recover," said Rick Mishkin. "We've had cases of stock market declines, which were very substantial and the economy has not had huge effects. If the credit markets seize up you've got real problems."

Credit markets have been frozen for months.

Oil prices fell again, losing 50 cents to under $63 a barrel. The dollar rallied five percent against the yen following the threat of central bank intervention to hold down the skyrocketing yen. Tokyo stocks Tuesday rallied six percent from a 26-year low. The euro was weaker against the dollar, trading in New York at $1.26.