Creation

Japanese stocks rose, sending the Nikkei 225 Stock Average to its eighth weekly advance, after automakers’ sales grew in the U.S., the yen weakened and commodity prices gained.

Toyota Motor Corp., which gets 31 percent of its revenue in North America, climbed 1.5 percent after posting its first increase in U.S. sales in three months. Mitsui & Co., which counts commodities as its biggest source of profit, advanced 1.7 percent after prices for metals and oil gained. EAccess Ltd. soared 8.7 percent after saying it will issue fewer shares than it planned. Japan Tobacco Inc., which gets more than half its revenue in the country, fell 1.9 percent on concern deflation will slow economic recovery.

The Nikkei 225 advanced 0.4 percent to close at 11,286.09 in Tokyo. The broader Topix index rose 0.4 percent to 989.39, with eight shares gaining for every seven that declined.

“The global macroeconomic recovery is behind the current uptrend in equities,” Tomomi Yamashita, a Tokyo-based fund manager at Shinkin Asset Management Co., which oversees the equivalent of $3.8 billion, said in an interview yesterday after markets shut. “With Japan being in deflation, domestic-oriented companies can’t boost revenue.”

The Nikkei 225 has climbed 2.6 percent this week, an eighth weekly advance and the longest stretch of weekly gains since September 2005, as growth in China’s manufacturing and an increase in U.S. consumer spending bolstered optimism the global economic recovery is gaining momentum.

Dai-ichi Advances

The 25-day Toraku index, a measure of daily stock winners and losers in Tokyo, jumped to 150 yesterday, a level not seen since February 1998. A reading of more than 120 suggests the market is overheating, according to Nomura Holdings Inc.

Shares on the Nikkei 225 trade at 40 times estimated earnings, the highest level globally, according to data compiled by Bloomberg.

Dai-ichi Life Insurance Co., which started trading yesterday after the world’s biggest initial public offering in two years, rose 1.6 percent after surging as much as 5.5 percent. It was the most actively traded stock by value.

In New York, the Standard & Poor’s 500 Index climbed 0.7 percent to the highest close since Sept. 26, 2008. Initial jobless applications dropped by 6,000 to 439,000 in the week ended March 27, Labor Department figures showed. The Arizona- based Institute for Supply Management said its factory index rose to 59.6, the highest level since 1989. Readings above 50 signal expansion.

Toyota climbed 1.5 percent to 3,775 yen and contributed the most to the Topix’s advance. Closest rival Honda Motor Co. advanced 1.4 percent to 3,335 yen. Toyota’s U.S. sales surged 41 percent year-on-year in March, while Honda reported a 22 percent increase.

Economy Assessment

The yen depreciated to as much as 93.90 per dollar today from 93.52 at the 3 p.m. close of stock trading in Tokyo yesterday, while weakening versus the euro to 127.56 from 126.38.

Bank of Japan policy makers will consider raising their economic assessment, three people familiar with the matter said. The board may stop saying the expansion will “remain moderate” in coming months at the April 6-7 meeting because demand from emerging markets is spurring exports and production, according to one of the people.

“Heightening expectations globally for a further economic recovery are spurring investors to shift away from the yen” to higher yielding currencies, said Juichi Wako, a senior strategist at Tokyo-based Nomura Holdings Inc. “This is a favorable environment for Japanese stocks.”

New Shares

Mitsui, Japan’s No. 2 trading house, jumped 1.7 percent to 1,626 yen. Japan Petroleum Exploration Co., the nation’s second- largest oil explorer, climbed 3.5 percent to 4,875 yen, and bigger rival Inpex Corp. gained 2.1 percent to 720,000 yen.

JX Holdings Inc., the company created by the merger of Nippon Oil Corp. and Nippon Mining Holdings Inc., surged 12 percent to 523 yen and was the biggest winner in the Nikkei 225. Nomura rated the stock “buy,” saying the merger will improve JX’s profitability.

Crude oil for May delivery rose 1.3 percent to $84.87 a barrel in New York yesterday, the highest settlement price since October 2008. A gauge of six metals in London advanced 1.1 percent yesterday, extending its gain for a sixth day, the longest winning streak since July 27.

EAccess Ltd., a provider of Internet access services, surged 8.7 percent to 74,700 yen, with its trading volume four times bigger than yesterday. The company said on March 31 that it will acquire the shares of Emobile Ltd. that it doesn’t own by issuing 1.69 million new shares to pay for the stake. EAccess, which owns 38 percent of closely held Emobile, said on Dec. 7 that it would issue as many as 1.98 million shares.

‘Challenging Environment’

“Concern about the dilution of eAccess’s equity has eased, lifting the stock,” said Makio Inui, an analyst at UBS AG.

Japan Tobacco lost 1.9 percent to 340,500 yen and was the heaviest drag on the Topix. KDDI Corp., the nation’s No. 2 mobile-phone carrier, lost 1.4 percent to 480,000 yen. FamilyMart Co. and Lawson Inc., convenience-store operators, lost 1.4 percent and 2.1 percent respectively after Bank of America Corp.’s Merrill Lynch unit downgraded the stocks to “underperform.”

More small companies were pessimistic about their business outlook than those that were optimistic, the Bank of Japan’s quarterly Tankan survey showed yesterday. On March 26, a government report showed Japan’s consumer prices excluding fresh food slid for a 12th month in February.

“The domestic economy is still in a challenging environment,” said Hiroshi Morikawa, a senior strategist at MU Investments Co., which manages the equivalent of $13 billion in Tokyo. “With worsening confidence among small companies, a recovery in employment is likely to be dull.”