Tokyo's stock market made small gains today to claw back some of the previous day's heavy losses, but expectations the United States will raise interest rates next month kept a lid on the rebound.
Share market sentiment was helped by lower oil prices, with a barrel of US light crude quoted at $38.93, more than one dollar below a recent 13-year peak after Saudi officials called for higher output.
The Nikkei stock average, where a 1,200 point slump in six sessions prompted Finance Minister Mr Sadakazu Tanigaki to say he was following market developments closely, gained 0.19 per cent to 10,905.85.
Japan's broader TOPIX index rose 0.50 per cent to 1,090.98, after losing 10 per cent in four trading days, as investors bought shares in banks, insurers and technology firms.
Analysts said Japan's market had fallen too far recently, given a healthy economic outlook and improving corporate earnings.
Taking advantage of low US rates, many investors had borrowed dollars to buy higher yielding currencies and shares around the globe, particularly in Japan - a so-called dollar-carry trade.
They have been rushing to close such positions as their funding costs look sure to rise sooner rather than later, boosting the dollar against most other currencies in recent days.
Asia's small stock gains followed yesterday's broad sell-off across world markets after the US had said it created more new jobs than expected in April, raising equity investors' fears about accelerated rate hikes by the US central bank.
US bond yields have already risen sharply in recent weeks.
The Dow Jones industrial average lost 1.26 per cent to close below 10,000 points for the first time since mid-December. Europe's main exchanges dropped by between 2 and 4 per cent.