Hong Kong and Shanghai, which surged more than four percent Tuesday, enjoyed another bumper start following a record performance on Wall Street, while gold also pushed to an all-time high.
The shift by China to provide support to an economy battered by a long-running debt crisis in the property sector and weak consumer spending added to the upbeat mood among traders after the Federal Reserve's bumper rate cut last week.
However, some observers warned that Beijing would need to follow up with more stimulus to maintain momentum and ensure the economy can get back on track.
On Wednesday, the People's Bank of China said it would snip the medium-term lending facility -- the interest for one-year loans to financial institutions -- from 2.3 percent to 2.0 percent. The rate was last lowered in July.
That came on top of Tuesday's decision to lower other rates, loosen rules on how much cash banks must keep in reserve, provide bigger incentives to buy homes and plans to consider a stock stabilisation fund.
The moves suggest Beijing is giving way to calls to boost the world's number two economy as it struggles to recover from the pandemic, even after the removal of painful restrictions at the end of 2022.
Chaoping Zhu, global market strategist at JP Morgan Asset Management, said: "We believe these steps are in the right direction. The sense of urgency may convince investors that more policy support is on its way.
"Also, the decision of announcing multiple stimulus measures in one go, rather than spacing them out, should provide a stronger signal to the market."
In early trade, Hong Kong and Shanghai were joined by Tokyo, Sydney, Seoul, Wellington and Taipei.
The rally followed the fresh records for the Dow and S&P 500 in New York.
While the mood is upbeat for now, some analysts sounded a note of caution.
Ray Attrill, head of forex strategy at National Australia Bank, said that while the measures "collectively look highly meaningful, (they) will need to be complemented by a major shift in fiscal policy thinking if they are to be regarded as very much more than the proverbial 'pushing on a string'.
"This is in terms of their ability to drive a meaningful turnaround in domestic consumer confidence and spending, via instilling confidence that a floor under house prices and domestic equity prices -- the main two ways in which Chinese households hold their wealth -- is to hand."
While China's latest moves are providing support, traders are also awaiting the release Friday of the personal consumption expenditures index -- the Fed's preferred inflation metric -- hoping for an idea about its next interest-rate move.
The US central bank's jumbo cut last Wednesday ramped up hopes that it will embark on a series of reductions as prices come under control and the jobs market slows, with many observers confident the economy is on course for a soft landing.
Officials are expected to continue easing policy through to 2026, according to the Fed's "dot plot" guidance on rates released last week.
The prospect of more cuts helped gold hit a new peak of $1,665.24 as investors seek out better returns in the precious metal, which is also providing safe haven sanctuary from geopolitical tensions, particularly in the Middle East.
- Key figures around 0230 GMT -
Tokyo - Nikkei 225: UP 0.3 percent at 38,068.22 (break)
Hong Kong - Hang Seng Index: UP 2.1 percent at 19,398.34
Shanghai - Composite: UP 2.3 percent at 2,927.74
Euro/dollar: UP at $1.1187 from $1.1181 on Tuesday
Pound/dollar: UP at $1.3414 from $1.3412
Dollar/yen: UP at 143.47 yen from 143.18 yen
Euro/pound: UP at 83.39 pence from 83.33 pence
West Texas Intermediate: DOWN 0.1 percent at $71.46 per barrel
Brent North Sea Crude: DOWN 0.1 percent at $75.11 per barrel
New York - Dow: UP 0.2 percent at 42,208.22 (close)
London - FTSE 100: UP 0.3 percent at 8,282.76 (close)
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