Japan's Nikkei gains as dollar tops 100 yen

LONDON Japanese stocks enjoyed another big advance Friday after the dollar finally broke through the 100 yen mark following several failed attempts. Markets elsewhere retained their positive momentum that's seen many stock indexes, particularly in the U.S., strike all-time highs.

The Nikkei 225 index in Tokyo jumped 2.9 percent to close at 14,607.54, its highest level since January 2008, after the dollar traded above 100 yen for the first time in more than four years -- a lower currency potentially makes the country's exports cheaper. By late morning London time, the dollar was 0.7 percent higher at 101.36 yen.

"The Nikkei continues to demonstrate the fine form shown in April, and with the dollar finally breaking the psychological 100 yen level the Japanese index could be set for new highs," said Alastair McCaig, market analyst at IG.

The yen has been under acute pressure over recent weeks as the new government of Prime Minister Shinzo Abe attempts to get the world's number 3 economy out of its two-decade stagnation. A key pillar of that attempt has been to give the Bank of Japan the tools to pursue a super-loose monetary policy that creates more yen in circulation.

The yen is likely to feature in discussions later between the finance ministers and central bankers of the world's leading industrial economies. The policy of benign neglect over the yen's depreciation has been based on the belief that Japan's policymakers have not directly targeted the exchange rate.

"In a way, this recent yen move could not have been more badly timed, coming as it does on the eve of the latest G-7 meeting, with further yen losses quite likely," said Michael Hewson, senior markets analyst at CMC Markets.

Elsewhere, European stocks continued their strong run, with Britain's FTSE 100 up 0.6 percent at 6,634. Germany's DAX rose 0.9 percent to 8,334 while France's CAC-40 France's advanced 0.8 percent to 3,958.

Wall Street was poised for a solid opening, with Dow futures up 0.3 percent and the broader S&P 500 futures 0.2 percent higher.

Many indexes around the world, including Germany's DAX and the Dow and the S&P in the U.S. have hit a series of all-time highs this week for a number of reasons, including hopes over the U.S. job market and a seeming easing of Europe's debt crisis. An expectation that the world's central banks will not be reversing course and tightening policy any time soon has also lain behind the seeming euphoria in markets.

Elsewhere in Asia, South Korea's Kospi plummeted 1.8 percent to 1,944.75 amid jitters over competition with Japan, whose weakened currency puts South Korean exporters at a disadvantage.

Hong Kong's Hang Seng gained 0.5 percent to 23,321.22.

Oil prices were down slightly after a strong run, with the benchmark New York rate 62 cents lower at $95.77 a barrel.