Japan Leads Asian Equities Higher

Asian stocks climbed, led by Japanese shares as the yen slid to an almost eight-month low versus the dollar amid signs of strength in the U.S. economy. Crude oil rallied with palladium as Australian bonds declined.

The MSCI Asia Pacific Index rose 0.2 percent by 10:07 a.m. in Tokyo, as Japan’s Topix index gained 0.6 percent. The yen dropped to as low as 105.27 per dollar, the weakest level since Jan. 10. Oil in New York advanced 0.3 percent from the lowest close since January. Palladium climbed 0.1 percent following yesterday’s 2.9 percent rout. Yields on 10-year Australian debt rose seven basis points, pacing a retreat in Treasuries. Standard & Poor’s 500 Index futures were little changed after the benchmark U.S. index slipped 0.1 percent from a record.

U.S. factory output grew in August at the fastest pace in three years, underlining the economy’s divergence with Europe and China, where gauges of manufacturing this week dropped more than analysts projected. Japan and the euro area see service-industry data today, before the European Central Bank and the Bank of Japan review monetary policy tomorrow amid speculation over the outlook for stimulus. Australia may report today that economic growth slowed in the second quarter.