Toyota recalls Prius, other hybrids over brakes

"The shares fell while Toyota appeared not to be doing anything to deal with its problems. But now, the fact that they're taking concrete steps on the issue is being seen as positive," said Hiroaki Osakabe, a fund manager at Chibagin Asset Management.

Analysts were reluctant to call the bottom for the stock, however.

"I think it's still much too early to say that all the bad news is out," said Norihiro Fujito, general manager at Mitsubishi UFJ Securities in Tokyo. "At least for now we're seeing short-covering and buying on a sense that the share has been oversold."

LAWSUITS

In the apparent first of a potential rush of legal claims over the Prius, the owner of a 2010 Prius has sued Toyota in Los Angeles, claiming the automaker failed to fix a brake defect and seeking a court order requiring a recall.

Meanwhile, complaints to U.S. safety regulators about 2010 Prius brake problems have jumped sharply since the Transportation Department announced a formal investigation last week.

Several complaint files total more than 1,000 reports from vehicle owners but a partial review of the documents submitted to NHTSA found some duplicates, so the exact number is unclear. Four injuries were reported.

More bad news came when KBB, or Kelley Blue Book, said on Monday it plans to cut U.S. used-car values of recalled Toyotas by 1.5 percent "on concerns around the growing supply of unsold Toyotas on both dealer lots and at auctions."

Toyota faces further scrutiny on Wednesday when its North America chief executive, Yoshimi Inaba, testifies to Congress in front of the House Oversight Committee in Washington.

Transportation Secretary LaHood and NHTSA Administration Administrator David Strickland will also testify.