The benchmark Nikkei Stock Average of 225 selected issues climbed 99.66 points, or 0.88 percent, to finish at 11,376.57 points. The index lost 12.58 points, or 0.11 percent, on Tuesday.
The dollar bought 103.64 yen by late afternoon Wednesday, up 0.50 yen from late Tuesday but below the 104.13 yen it bought in New York later Tuesday.
Japanese exporters, including Honda Motor Co. and Toyota Motor Co., benefited Wednesday from the weakening yen. A stronger dollar helps boost the value of their overseas earnings.
Gains by U.S. high-technology shares drove up their Japanese counterparts, allowing Canon Inc., Sony Corp. and Advantest Corp. to end higher.
Stocks of companies with large businesses in China, meanwhile, attracted investors following China's announcement Tuesday that its real gross domestic product grew 9.5 percent last year.
Investors "still want to wait for more corporate earnings results, but the market does react to good news related to the U.S. and China, which are Japan's two major sources of external demand," said Shinko Securities strategist Tsuyoshi Segawa.
Gainers among China-related stocks included steel makers such as Nippon Steel, which rose 2.0 percent and JFE Holdings which advanced 2.7 percent.
The broader TOPIX index of all issues on the Tokyo Stock Exchange's first section rose 6.86 points, or 0.6 percent, to 1,144.89 points. The index lost 1.15 points, or 0.10 percent, on Tuesday.
In New York Tuesday, a string of strong earnings reports sent stocks sharply higher, with the Dow Jones industrial average turning in its best showing of the year.
The Dow Jones average rose 92.95 points, or 0.9 percent, to 10,461.56, posting its best one-day jump since Dec. 21. The tech-heavy Nasdaq composite index climbed 11.25, or 0.56 percent, to 2,019.95.
In currencies, the dollar was up against the euro and yen after shooting up Tuesday in New York, although some of those gains against the yen were pared in Tokyo trading.
An announcement that China had surpassed the United States for the first time as Japan's biggest trade partner in 2004 did not appear to immediately affect the dollar's gains against the yen. Total trade with China and Hong Kong came to 22.2 trillion yen ($213.28 billion) in 2004 versus 20.48 trillion yen ($196.75 billion) with the United States, the Finance Ministry said.
"China's importance has been growing for some time, so this should be priced into the markets," said Toshiaki Kimura, foreign exchange trader at Mitsubishi Trust.
The euro fell to $1.2993 late Wednesday in Tokyo from $1.3057 late Tuesday. Against the Japanese currency, the euro was little changed at 134.59 yen from 134.60 yen.
The yield on Japan's benchmark 10-year government bond rose to 1.3400 percent from Tuesday's finish of 1.3300 percent. Its price fell 0.09 point to 100.52. (Reuters)