Japan's Stocks Climb on Weaker Yen; Toyota Leads Exporter Gains

Japanese stocks rose after the yen weakened by the most in three months against the dollar and in more than two years against the euro. Toyota Motor Corp. led exporters higher as a weaker yen boosts revenue.

``The market is in rebound mode right now,'' said Toshihiko Matsuno, an analyst at SMBC Friend Securities Co. in Tokyo. ``If the yen continues to weaken, exporter shares will rally.''

The Nikkei 225 Stock Average added 141.91, or 0.8 percent, to 16,986.41 as of 9:32 a.m. in Tokyo. The broader Topix index rose 20.19, or 1.2 percent, to 1712.73.

Nikkei futures expiring in March climbed 0.9 percent to 16,970 in Osaka and advanced 0.8 percent to 16,975 in Singapore.

Yesterday, the Nikkei climbed 1.2 percent and the Topix index rose 1.8 percent, snapping a five-day losing streak that had erased 48.6 trillion yen ($416 billion) off the value of shares traded on the first section of the Tokyo Stock Exchange.

Toyota, Japan's most profitable automaker in terms of profit margin, jumped 140 yen, or 1.8 percent, to 7,860. Sony Corp., the maker of the PlayStation 3 games console, added 60 yen or 1 percent, to 5,950. Komatsu Ltd., the world's second- largest maker of construction machinery, rose 60 yen, or 2.4 percent, to 2,585.

The yen weakened 0.9 percent to 116.59 per dollar yesterday in New York, the biggest drop since Dec. 8. Japan's currency fell 1.2 percent to 153.07 per euro, the largest decline since Nov. 10, 2004. The yen recently changed hands at 116.76 against the dollar and 153.35 against the euro.

Paulson Provides Reassurance

A weaker yen increases the value of Japanese exporters' foreign currency-denominated sales when converted back into local terms, while their products become more competitive abroad.

Stocks also advanced after U.S. investors cheered comments from Treasury Secretary Henry Paulson that subprime loan defaults and delinquencies will not cause problems for the general financial industry in the world's largest economy.

A subprime loan has a higher interest rate than loans extended to a bank's most credit-worthy customers.

The Standard & Poor's 500 Index jumped 1.6 percent, while the Dow Jones Industrial Average climbed 1.3 percent. That was the best performance for both benchmarks since July 24.

``The strong performance of U.S. markets bodes well for Japan today,'' said SMBC's Matsuno.