5:00 AM New York, 7:00 PM Tokyo - Bank of Japan calls for unscheduled meeting. Cabinet approves new stimulus economic package totalling $45 billion. Wages in Japan fall 1.7% in October.

Japan’s stock indexes surged as the yen fell the most in seven weeks as investors speculated about the outcome of an unscheduled Bank of Japan monetary policy meeting.

Cabinet also approved a new stimulus plan to stem falling prices.

In Tokyo trading Nikkei 225 Index rose 2.4% or 226.65 to 9,572.20, and the broader Topix Index gained 2.1% to 87,52.

In the first section of the Tokyo Stock Exchange 9.9 billion shares worth 619 billion yen were traded and in the second section 271 million shares valued at 2.8 billion yen changed hands.

Of the Nikkei 225 index stocks, 209 rose, 15 fell, and one was unchanged. Pioneer Corp. led gainers in the index shares with a rise of 9.4% followed by Isuzu Motors increasing 8.1% on a dropping yen.

The yen fell to 87.52 against the dollar before closing at 87.45.

Dubai Worries Ease for Now

Indexes in Asia and Japan rebounded for the second day in a row after investors fears of Dubai led financial contagion receded. Crude oil and gold gained more than 1.3% as investors returned to metals and commodities markets. The prospect of debt restructuring dimmed the fear of wider contagion.

Global markets rebounded after Dubai World initiated talks to restructure less than half of $59 billion of loans. Investors’ fears of wider contagion involving Russia, Ireland and Greece for now are receding.

Dubai World said that restructuring talks with lenders are “constructive” and is seeking to delay the repayment of $26 billion of loans. For now there appears to be no talks to reduce the debt burden and at least nine lenders are involved in direct talks. HSBC, Standard Chartered Plc, Royal Bank of Scotland and Barclays are among these banks.

BoJ Calls for Unscheduled Meeting

Bank of Japan Governor Masaaki Shirakawa today called for an unscheduled monetary policy meeting. The meeting was scheduled for 2 pm in Tokyo.

Market watchers note the central bank might introduce quantitative easing to spur economic growth.

Cabinet Approves New Stimulus Plan

Nikkei News reported Japan’s finance minister Hirohisa Fujii said today the government has approved a fresh stimulus package to stave off the effects of deflation and deal with the present fluctuations in the currency market.

The package includes a second extra budget for the current fiscal year and includes a change of regulations to “create fresh demand.”

According to the report, government expects the central bank to prop the economy through appropriate monetary interventions. The government is planning to spend 4 trillion yen ($45 billion) to stimulate demand.

Japan government hopes that quantitative easing will help combat the effects of deflation.

Japan’s Wages Fall 1.7% in October