By Jonathan Burgos and Yasuhiko Seki Dec. 3 (Bloomberg) -- Shares of Japanese exporters soared, driving Asian stocks toward the biggest four-day rally since May, after the yen slid for the third day against the dollar and euro, and consumer spending lifted regional economies in the U.S. The yen weakened against all 16 of its major counterparts and traded as low as 87.92 against the dollar today. The MSCI Asia Pacific Index rose 1.8 percent to 123 as of 4:45 p.m. in Tokyo, where Japan’s Nikkei 225 Stock Average jumped 3.8 percent to 9,977.67. Futures on the Dow Jones Euro Stoxx 50 Index rose 0.9 percent at 7:30 a.m. London time. The Federal Reserve yesterday said the world’s largest economy improved “modestly” across the U.S. from October to mid-November as consumer spending increased. The Fed said eight regions “indicated some pickup in activity or improvement in conditions,” in its Beige Book report. “We’re positive on Asia as the U.S.’s improving economy bodes well for Asian exporters,” said Khiem Do, Hong Kong-based head of multi-asset strategy at Baring Asset Management (Asia) Ltd. in Hong Kong, which oversees $10 billion. “The U.S. recovery might be more subdued than elsewhere, but it’s still a recovery,” said Prasad Patkar, who helps manage $1.7 billion at Platypus Asset Management in Sydney. ”As long as there are no systemic shocks, there is no underlying, fundamental reason for things to start going backwards.” The yen’s decline against the dollar helps boost the value of overseas earnings at Japanese companies when converted into their home currency. Automakers, Electronics Toyota Motor Corp., the world’s largest automaker, rose 5.6 percent in Tokyo. Sony Corp., which gets almost 25 percent of its sales from the U.S., climbed 6 percent. Honda Motor Co., which derives almost 60 percent of its sales abroad, gained 4.19 percent. Sharp Corp. increased 4.98 percent as the stock was lifted to “neutral” from “sell” at UBS AG. The Nikkei has advanced 13 percent this year to 9,977.67, still about a quarter of the postwar closing peak of 38,915.87 reached on the last day of trading in 1989. That compares with gains of 19 percent this year for the Dow Jones Industrial Average in the U.S. and 24 percent for the Dow Jones Stoxx 600 Index in Europe. The yen climbed to a 14-year high against the dollar last week and has averaged 93.89 this year, the strongest since currencies began trading freely in 1971. That has weighed on the Topix, making its 2.7 percent gain in 2009 the lowest return among the world’s 40 largest stock markets. ECB Meeting The euro climbed against 10 of its 16 most-traded counter parts amid speculation the European Central Bank will unveil plans to scale back emergency lending while keeping borrowing costs low at today’s meeting in Frankfurt. ECB President Jean-Claude Trichet will today say the bank’s third offer of 12-month loans to banks on Dec. 15 will be the last and may signal a reduction in other lending operations. The bank will also leave the benchmark interest rate at 1 percent, according to all 54 economists in a Bloomberg News survey. “There is a strong belief the ECB will lead the exit of credit-easing among the developed countries,” said Kazumasa Yamaoka, senior currency analyst in Tokyo at GCI Capital Co., a foreign-exchange margin service company. “This perception will support the euro against the dollar and the yen.” The 16-nation currency rose for a third day against the yen, climbing as much as 0.9 percent to 132.68. The euro gained as much as 0.3 percent to $1.5096. Gold Record Gold for immediate delivery climbed 0.8 percent to a record $1,225.04 an ounce and traded at $1,217.80 at 2:50 p.m. Singapore time, as the U.S. dollar index, which tracks the greenback against the currencies of six major U.S. trading partners, dropped as much as 0.2 percent. The precious metal has advanced 39 percent this year as investors sought to protect their wealth against a declining dollar. Hu Xiaolian, a deputy governor at the People’s Bank of China, said the price of gold is very high, Apple Daily reported today. The central bank will be wary of investments in “bubble” assets, the Hong Kong newspaper cited Hu as saying at an event in Taipei. There has been speculation that China may buy about 190 tons remaining from the 403.3 tons the International Monetary Fund announced Sept. 18 it would divest to shore up its finances. Crude oil traded below $77 a barrel in New York after falling 2.3 percent yesterday as a government report showed a gain in U.S. stockpiles last week as consumption declined in the world’s biggest energy consumer. Oil Retreats “Energy is not the flavor of the day,” Jonathan Barratt, managing director at Commodity Broking Services Pty in Sydney, said by telephone. Crude oil for January delivery rose 32 cents to $76.66 a barrel in electronic trading on the New York Mercantile Exchange at 2:50 p.m. in Singapore. South Korea’s won fell 0.16 percent to 1,155.20 per dollar as the currency may be “affected” by a 50 percent narrowing in the current account surplus next year from more than $40 billion this year, Ahn Byung Chan, head of the international bureau at the Bank of Korea, said yesterday. “As you move into a deeper phase of recovery, import demand will pick up which will reduce the trade surplus,” said Wai Ho Leong, an economist with Barclays Plc in Singapore. “The recovery story is still pretty much intact. At the moment activity indicators in Asia may have paused but I don’t think there’s anything to worry about.” The Australian and New Zealand dollars gained before a government report tomorrow forecast to show U.S. job losses eased to the slowest pace in more than a year, boosting demand for higher-yielding assets. The Kiwi and Aussie were the biggest gainers against the dollar and the yen as signs of an economic recovery spurred demand for higher-yielding securities. Australia’s currency rose to 92.89 U.S. cents from 92.48 cents in New York yesterday, and gained 0.9 percent to 81.51 yen. New Zealand’s dollar climbed to 72.63 U.S. cents from 72.21 cents, and advanced 1 percent to 63.70 yen. Benchmark interest rates are 3.75 percent in Australia and 2.5 percent in New Zealand, compared with 0.1 percent in Japan and as low as zero in the U.S., attracting investors to the South Pacific nations’ higher-yielding assets. The risk in such trades is that currency market moves will erase profits. To contact the reporters on this story: Jonathan Burgos in Singapore at Jburgos4@bloomberg.net; Yasuhiko Seki in Tokyo at Yseki5@bloomberg.net.

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