An initial rally in European stocks faltered Wednesday despite gains in Asia that followed two days of big losses and a hefty, surprise rate cut by the US Federal Reserve, CNN reported.

After nearly an hour of trading in London, the FTSE 100 list of leading shares, which tumbled 5 % on Monday, had risen at 0840 GMT by 0.37 % on Tuesday's close to reach 5761.

The Paris CAC 40 was up by 1.19 % at 4900 while the Frankfurt DAX 30 rose 0.69 % at 6815.

Asian markets were also up. Japan's benchmark Nikkei index gained 2.04 %, to close at 12,829.06 points on the Tokyo Stock Exchange.

Hong Kong's Hang Seng index made a dramatic rally, closing up 10.7 % at 24,090.17.

Australia's benchmark S&P/ASX200 index rose 4.4 % to close at 5,412.3 after losing 7.1 percent the day before.

The Korea Composite Stock Price Index gained 19.40 points, or 1.2 %, to close at 1,628.42.

Singapore's index was up 3.7%, while India's benchmark index rose 4.6% in early trading.

The benchmark Shanghai Composite Index dropped 0.6% to 4,533.06 by midday.

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