Oct. 30 (Bloomberg) -- Japan stocks soared, sending the Nikkei 225 Stock Average to its sharpest three-day advance in at least 38 years, as a gain in commodity prices and a weaker yen boosted the profit prospects for resource companies and carmakers.

Mitsubishi Corp. and Mitsui & Co., trading companies that get more than half their profit from commodities, soared more than 12 percent. Mazda Motor Corp., which exports 80 percent of its production, jumped 25 percent, the most in at least three decades, after the yen weakened to 99.12 against the dollar. Mobile carrier Softbank Corp. surged by its limit of 13 percent after saying it will generate positive cash flow from this year.

The Nikkei 225 climbed 817.86, or 10 percent, to close at 9,029.76 in Tokyo, the fourth-biggest gain in its 59-year history. The broader Topix index rose 69.05, or 8.3 percent, to 899.37. The Nikkei had fallen 41 percent in the past six months, steeper than the Standard & Poor's 500 Index's 33 percent slide and a 34 percent drop in Europe's Dow Jones Stoxx 600 Index.

``Japan's market will likely rebound faster as it has slumped more than other major markets'' said Masaru Hamasaki, senior strategist at Toyota Asset Management Co. in Tokyo, which manages about $15 billion. If the yen stays at about 100 versus the dollar, ``it'll lead to a decline in material costs in a few months' time, benefiting manufacturers.''

The Nikkei 225 posted a three-day gain of 26 percent, the steepest since Nikkei Inc. took over the benchmark from the Tokyo Stock Exchange in July 1970. Even so, the measure is on track to record its worst month in that history, losing 19 percent. Six of the 10 biggest moves in the gauge in that period occurred this month, including a record 14 percent jump on Oct. 14.

Crude Prices

Mitsubishi, Japan's biggest trading company, rose 18 percent to 1,804 yen, its biggest jump since at least 1974, the extent of Bloomberg pricing data. Mitsui, the No. 2, jumped 12 percent to 935. Inpex Corp., Japan's biggest oil explorer, climbed 10 percent to 549,000 yen, while closest rival Japan Petroleum Exploration Co. added 7.5 percent to 4,040 yen.

Crude oil for December delivery climbed 4.3 percent to $70.38 a barrel, after having risen the most in a month yesterday. Copper futures for December delivery surged 12 percent in New York yesterday, the steepest jump in two years. A $1 gain in a barrel of crude boosts Inpex's annual profit by 2.2 billion yen ($22 million), the company said in May.

Japanese Prime Minister Taro Aso will announce new economic stimulus measures worth 5 trillion yen, the Yomiuri and Asahi newspapers reported today. That would follow interest rates cuts by central banks in the U.S., China and Taiwan in the past two days to stimulate demand. European Central Bank Governor Jean- Claude Trichet said on Oct. 27 he may cut rates next week.

``That major states have showed their determination to support the global economy will likely turn around investor sentiment from sheer pessimism,'' said Toyota Asset's Hamasaki.

Stronger Currency

Mazda, which gets more than half its profit from Europe, soared 25 percent to 247 yen, the sharpest jump since at least 1974. Honda Motor Co., Japan's second-biggest automaker, added 13 percent to 2,760 yen, while market leader Toyota Motor Corp. advanced 11 percent to 3,900 yen. Olympus Corp., an endoscope maker that counts Europe as its biggest overseas market, jumped 14 percent to 1,997 yen.

The Japanese currency weakened against the dollar to as much as 99.12 from 96.92 at the close of stock trading in Tokyo yesterday, while depreciating against the euro to as weak as 131.04 from 123.29. A strong yen cuts the value of overseas sales of Japanese businesses, and has led companies including Canon Inc. and Sony Corp. to reduce profit targets in the past week.

Asset Allocation

Softbank leapt 13 percent to 850 yen, bringing a two-day gain to 31 percent. The company yesterday said its surplus cash flow will increase by 79 percent next fiscal year, stemming concern the operator will be squeezed by the credit turmoil. Softbank had debt that was 8.4 times its common equity as of March 31, according to Bloomberg data.

Komatsu Ltd., the world's second-biggest maker of earthmoving equipment, added 12 percent to 954 yen. The company, whose shares have fallen 72 percent in the year through yesterday, lowered its annual earnings forecast by a 10th and said it would spend as much as 30 billion yen to buy back shares.

``Investors who need to follow asset-allocation guidelines are pressed to increase their stock purchases because of a recent declines in the market,'' said Kenji Sekiguchi, general manager of strategic research and investment at Mitsubishi UFJ Asset Management Co., which manages about $61 billion. ``That helped accelerate the market's rally.''

The Tokyo exchange today suspended until December minimum market capitalization requirements for listed companies following the market's recent plunge.

To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.

Last Updated: October 30, 2008 04:35 EDT