April 10 (Bloomberg) -- Japanese stocks climbed, capping a fifth weekly advance, as higher commodity-transport fees raised the earnings outlook for shipping companies.

Kawasaki Kisen Kaisha Ltd., Japan’s No. 3 shipping line, leapt 6.1 percent after cargo rates rose for the first time in a month. Isuzu Motors Ltd., the nation’s top truckmaker, soared 12 percent after Morgan Stanley said demand in emerging markets will help earnings. Sony Corp. rose 4.2 percent after fewer Americans sought unemployment insurance. Sumitomo Mitsui Financial Group Inc. plunged 14 percent after posting an unexpected loss and said it plans to sell new shares.

The Nikkei 225 Stock Average rose 48.05, or 0.5 percent, to close at 8,964.11 in Tokyo. The broader Topix index climbed 4.16, or 0.5 percent, to 845.97. Both gauges swung more than 10 times between gains and losses in the afternoon session. For the week, the Nikkei climbed 2.5 percent, while the Topix added 1.8 percent. Both gained for a fifth-straight week.

“The market has started to reflect a possible recovery as there are signs the global economy is bottoming out,” said Masaru Hamasaki, a senior strategist at Toyota Asset Management Co., which oversees about $3.3 billion. “Banks are still suffering from losses on their stockholdings and selling new shares to bolster their capital emphasizes the negative aspect of having to raise more money.”

The Nikkei has climbed 1.2 percent in 2009, compared with a 5.2 percent decline in the Standard & Poor’s 500 Index in the U.S., amid expectations the Japanese government will use public money to support the nation’s equity market. The price-book ratio on the Nikkei rebounded yesterday to 1 for the first time since Jan. 9.

Rising Valuations

“The price-book ratio recovered to 1, so Japanese shares have become less attractive in terms of valuations,” said Tsutomu Yamada, a market analyst at Kabu.com Securities Co.

Kawasaki Kisen advanced 6.1 percent to 400 yen, while Mitsui O.S.K. Lines Ltd., Japan’s second-largest shipping line, climbed 6.6 percent to 580 yen. The Baltic Dry Index, a measure of shipping costs for commodities, rose 1 percent yesterday in London, the first gain since March 10.

Isuzu, which earns more than a quarter of its sales in Asia, surged 12 percent to 155 yen, the highest close since Nov. 11. Morgan Stanley boosted its rating on Isuzu to “overweight” from “equal-weight,” saying demand for trucks in China, Indonesia and other emerging markets has been stronger than the brokerage expected.

“It’s highly possible the U.S. and Chinese economies will have V-shaped recoveries,” said Toyota Asset’s Hamasaki.

China, U.S.

China Association of Automobile Manufacturers yesterday said the nation’s passenger car sales climbed by a 10th from a year earlier to a record in March. Tax cuts and government subsidies boosted demand.

Sony, a consumer-electronics maker that derives a quarter of its sales from the U.S., jumped 4.2 percent to 2,585 yen. Larger rival Panasonic Corp. added 3.3 percent to 1,323 yen. Electronics makers as a group accounted for more than half of the Topix’s advance.

U.S. first-time claims for unemployment insurance fell by 20,000 to 654,000 in the week to April 4, the Labor Department reported yesterday, fewer than the 660,000 economists had estimated. White House chief economic adviser Lawrence Summers yesterday said the “free-fall” in the U.S. economy will end within the next few months.

Unexpected Loss

Sumitomo Mitsui, Japan’s No. 3 listed bank by assets, dived by the daily limit of 14 percent to 3,110 yen, the steepest plunge since Oct. 16. The lender lost 390 billion yen ($3.89 billion) in the year ended March 31, it said yesterday, the biggest loss in six years. Analysts had expected a profit. To shore up capital, the company prepared to sell as much as 800 billion yen of common shares.

Mizuho Financial Group Inc., the nation’s No. 2 listed bank, dived 9.6 percent to 198 yen and was the most actively traded stock by value in Tokyo. A gauge of bank shares posted the steepest decline among 33 industry groups on the Topix.

“More banks may sell new shares if the domestic economy continues to deteriorate and bigger loan-loss reserves are needed,” said Hiroshi Fujimoto, a fund manager at Tokyo-based Shinkin Asset Management Co. in Tokyo, which manages the equivalent of $5.7 billion.

Nikkei futures expiring in June added 0.5 percent to 8,970 in Osaka and advanced 0.7 percent to 8,965 in Singapore.

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

Last Updated: April 10, 2009 03:27 EDT