June 4 (Bloomberg) -- Asian stocks advanced, led by exporters of cars and electronics, after Japanese and South Korean automakers outsold U.S. manufacturers in America for the first time and the dollar rallied.

Honda Motor Co., Japan's second-largest carmaker, rose to a six-month high in Tokyo and Kia Motors Corp. climbed the most in three weeks in Seoul. Sony Corp. gained after the Federal Reserve signaled interest rates won't be cut further, boosting the dollar. The U.S. currency has dropped 15 percent against the yen in the past year, cutting the value of Japanese exporters' sales.

``A sigh of relief is spreading among investors,'' said Kiyoshi Ishigane, a Tokyo-based senior strategist at Mitsubishi UFJ Asset Management Co., which manages about $61 billion. A weaker yen will ``make life much easier for exporters, and might enable them to raise their earnings forecasts,'' he said.

The MSCI Asia Pacific Index added 0.9 percent to 150.58 as of 7:59 p.m. in Tokyo, following a 1.8 percent retreat yesterday. A measure of car and consumer-electronic manufacturers surged 3.1 percent, the most in six weeks and the largest gain among the benchmark index's 10 industry groups.

Japan's Nikkei 225 Stock Average climbed 1.6 percent to 14,435.57. About half of Asia's equity markets advanced. India's Sensitive Index fell 2.8 percent, the biggest drop since April and the most among the region's benchmark indexes, after the government raised fuel prices, fanning inflation concerns. China's CSI 300 Index dropped 1.9 percent.

Shares of commodity producers fell, led by Woodside Petroleum Ltd. and Newcrest Mining Ltd., after crude oil and gold retreated.

Honda, Kia

U.S. stocks retreated yesterday on speculation that Lehman Brothers Holdings Inc. will be forced to raise more capital, while a drop in oil prices dragged energy producers lower. Standard & Poor's 500 futures were down 0.4 percent.

Honda jumped 8.6 percent to 3,790 yen, the highest close since Dec. 26. Kia Motors Corp., South Korea's second-biggest car manufacturer, rose 2.2 percent to 11,500 won.

Japanese and South Korean automakers boosted May sales by 3.7 percent to win a record 48.2 percent market share. General Motors Corp., Ford Motor Co. and Chrysler LLC fell a combined 21 percent as gasoline near $4 a gallon drove U.S. consumers from pickups and sport-utility vehicles.

Mazda Motor Corp., which exports 80 percent of domestic production, surged 9.1 percent to 598 yen. The stock was also added to a list of recommended stocks by Merrill Lynch & Co.

U.S. Fed

Sony gained 2.8 percent to 5,510 yen, advancing for the fourth time in five days. Matsushita Electric Industrial Co., the world's largest maker of consumer electronics, added 1.4 percent to 2,475 yen. Nintendo Co., maker of the Wii game console, climbed 2.8 percent to 58,400 yen.

Chairman Ben S. Bernanke said yesterday interest rates are ``well positioned'' to promote growth and stable prices. The central bank is working with the Treasury to monitor foreign- exchange markets and is aware of the effect of the dollar's decline on inflation and price expectations, he said.

The yen depreciated to as much as 105.56 against the dollar from 104.25 at the close of stock trading in Tokyo yesterday. The U.S. currency is down 15 percent against the yen since June 22, when the dollar reached a high of 124.13. Sony gets about a quarter of its sales from the Americas, while Nintendo generates almost 40 percent of its sales there.

Woodside, Australia's second-largest oil and gas explorer, dropped 4.4 percent to A$63.59, poised for its biggest retreat since March 20. Inpex Holdings Inc., Japan's biggest, declined 2.3 percent to 1.29 million yen. Cnooc Ltd., China's largest offshore oil explorer, lost 4.1 percent to HK$13.26 in Hong Kong.

Sumitomo Metal

Crude oil tumbled 2.7 percent to $124.31 a barrel in New York, the lowest since May 15, while gold sank 1.3 percent, as the dollar's rally reduced the appeal of commodities as an inflation hedge.

Newcrest, Australia's No. 1 gold producer, dropped 4.4 percent to A$63.59. Sumitomo Metal Mining Co., Japan's largest gold and nickel producer, retreated 2.8 percent to 1,731 yen.

In China, shares of Baoshan Iron & Steel Co., the nation's largest steelmaker, fell 1.9 percent to 11.95 yuan. China Iron and Steel Association ordered its members to hold prices at levels prevailing before the May 12 earthquake, the National Development and Reform Commission, the nation's top planning agency, said.

Fast Retailing Co. posted the second-biggest gain on MSCI's Asian index, advancing 11 percent to 9,860 yen. The operator of Japan's biggest clothing chain may post operating profit of about 83 billion yen ($790 million) for the year ending Aug. 31 on strong sales, the Nikkei newspaper said. That would exceed the company's April forecast of 80.1 billion yen.

To contact the reporter for this story: Chen Shiyin in Singapore at schen37@bloomberg.net; Masaki Kondo in Tokyo at mkondo3@bloomberg.net.

Last Updated: June 4, 2008 07:07 EDT