Unstoppable oil and gold lift resource shares

By Louise Heavens

SINGAPORE (Reuters) - Oil's relentless surge to a new peak above $124 weighed on Asian shares on Friday, while a stronger yen pressured Japanese exporters, such as Toyota Motor.

The euro held onto its gains after bouncing back from a two-month low against the dollar on Thursday when the head of the European Central Bank dampened some expectations for rate cuts by signalling that fighting inflation was his top concern.

Japanese government bonds surged as investors rushed to lock in relatively high yields.

Crude oil's record breaking run had kept stocks on the back foot earlier this week as investors digested the prospect of what Goldman Sachs predicted could be a new spike to $200 a barrel.

By 2:58 a.m. British time, crude was up 61 cents at $124.34 a barrel CLc1, having hit an intraday record of $124.61 in after-hours electronic trading late in the New York day.

Despite rising oil prices, Wall Street found support on increased optimism that the U.S. economy, while softening, was not altogether cracking under the strain of the subprime crisis.

The Dow Jones industrial average .DJI rose 0.4 percent, while the Nasdaq Composite Index .IXIC added 0.5 percent. In Europe, shares fell slightly as both the ECB and the Bank of England kept rates on hold.

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