Nikkei 225, Kospi, Hang Seng Index

Markets expect the Fed to keep interest rates steady at 3.5% to 3.75% on Wednesday stateside.

The Kospi gained over 5%, closing at 5,925.03, while the small-cap Kosdaq was up 2.41% to 1,164.38. A five-minute trading halt was activated after the Kospi 200 futures surged 5%, according to an official note.

South Korean President Lee Jae Myung on Wednesday called for sweeping capital market reforms to eliminate the “Korea discount” and achieve a “Korea premium,” targeting governance flaws, weak transparency and structural distortions, local media reported.

At a policy meeting, Lee Eog-weon, Financial Services Commission chief, also said the government will use current market volatility as a chance to push bold reforms and strengthen fundamentals. Planned measures include accelerating the delisting of weak firms, tightening rules to curb duplicate listings and revitalizing Kosdaq and Konex.

Index heavyweights Samsung Electronics and SK Hynix rose 7.5% and nearly 9%, respectively. Samsung’s gains come even as its unionized workers in South Korea voted to approve a strike, escalating a dispute over bonuses and increasing the risk of disruptions at the world’s largest memory chipmaker.

Japan’s Nikkei 225 jumped 2.87% to 55,239.4 while the Topix added 2.49% to close at 3,717.41 after the country reported that exports climbed 4.2% from a year ago in February, beating estimates.

Economists polled by Reuters had expected a 1.6% rise. Exports had risen 16.8% jump in the previous month.

Australia’s S&P/ASX 200 gained 0.31% to ending the trading day at 8,640.6.

Hong Kong Hang Seng index rose 0.68%, while the CSI 300 rose 0.45% to 4,658.33.

The Middle East war continues to escalate, keeping investors on edge. A fresh wave of attacks on the United Arab Emirates’ energy infrastructure has heightened fears of prolonged supply disruptions amid the Iran war.

The incidents followed a drone strike on the world’s largest ultra-sour gas development, a fire at the UAE’s Fujairah Oil Industry Zone, and damage to a tanker near the strategically vital Strait of Hormuz.

U.S. stock futures traded near the flat line ahead of the Fed’s policy decision. Futures tied to the Dow Jones Industrial Average lost 37 points, or 0.07%. S&P 500 futures dropped 0.07%, while Nasdaq 100 futures fell 0.02%.

Overnight in the U.S., the S&P 500 rose as Wall Street built on the momentum seen in the previous session amid developments in the Iran war.

The broad market index closed up 0.25% at 6,716.09, and the Nasdaq Composite climbed 0.47% to finish at 22,479.53. The Dow Jones Industrial Average added 46.85 points, or 0.1%, to end at 46,993.26.

— CNBC’s Lim Hui Jie, Sean Conlon and Pia Singh contributed to the report.