Asian stocks gained, with the MSCI Asia Pacific Index set for its third weekly advance, after BHP Billiton Ltd. and Rio Tinto Group said they're forming an iron- ore venture and the yen fell to its lowest in a     week.

Rio Tinto jumped 10 percent in Sydney as it scrapped an investment from Aluminum Corp. of China in favor of a share sale. Yen declined yesterday versus 15 of the 16 most-traded currencies on speculation Japanese investors are sending funds overseas to buy higher- yielding assets.

U.S. stocks rose for a fifth time in six days as analysts recommended buying bank shares and higher oil prices boosted energy producers, outweighing a slump in retailers following disappointing May sales. Stocks opened higher after initial jobless claims fell by 4,000 to 621,000 in the week ended May 30, in line with forecasts, from a revised 625,000 the prior week.

The Dollar Index, a six-currency gauge of the greenback's value, rose as much as 0.2 percent to 79.506. The index fell 0.2 percent yesterday, the most since Jan. 20, after touching 78.334 on June 2, the lowest since Dec. 18.

Crude oil rose after Goldman Sachs said prices may reach $85 a barrel by the end of the year as world demand recovers and supplies shrink. The European Central Bank signaled it will keep interest rates steady for some time, reinforcing the market's belief that the global recession was easing. Earlier Bank of England and Bank of Canada also kept interest rates unchanged.

Emerging-market equity funds received $3.79 billion in net inflows for the week ended June 3, led by investments in Asia excluding Japan, EPFR Global said. Funds that invest in Asian stocks excluding Japan added $1.54 billion, the most in dollar terms. Taiwan equity funds attracted $192 million during the week while those investing in Indian stocks took in $199 million, a 55-week high, EPFR wrote. Investors took $22.7 billion out of money-market funds this week and developed-market equity funds also had net outflows, the research company said.

India's monsoon, which accounts for four-fifths of the nation's annual rainfall, was 35 percent below average in the week ended June 3, the weather office said.