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Copper climbed 1 percent to a high of $9,654.25 a tone, nearing a record high of $9,754 struck on Tuesday, after an ADP report showed a record 297,000 U.S. private sector jobs were created in December, the clearest signal in months that a recovery in the world's biggest economy was shifting up a gear.

The figure prompted analysts to raise their forecasts for the closely watched non-farm payrolls data, with estimates now centering on an increase of 175,000 jobs, up from 140,000 in an earlier Reuters survey.

While some analysts were skeptical of the size of the jump in the ADP job report, it does follow a string of recent upbeat U.S. data showing the economy is picking up steam.

"Markets will now wait for U.S. payrolls on Friday for confirmation of the strong trend," said Hiroaki Osakabe, a fund manager at Chibagin Asset Management. "But investors will then focus on how the U.S. data will impact the dollar/yen rate."

Japan's Nikkei 225 index .N225 rose 1.2 percent and breached the psychologically important barrier of 10,500 to reach its best level since May 2010.

Major exporters including Canon Inc (7751.T) and Toyota Motors (7203.T) climbed more than 1 percent.

MSCI's Asia Pacific index excluding Japan .MIAPJ0000PUS, however, slipped 0.1 percent, having drifted in and out of positive territory. Earlier this week technical indicators showed it was close to being overbought after a strong end-2010 rally, making investors wary that markets were due for a pullback.

South Korea's KOSPI .KS11 and Hong Kong's Hang Seng index .HSI were both flat, while China's Shanghai Composite index .SSEC shed 0.7 percent.

Australia's S&P/ASX 200 index .AXJO reversed early gains ad slid 0.4 percent as concerns over severe floods in the country's northeast made investors unsure of how to judge company earnings in 2011.

Global miner BHP Billiton (BHP.AX) fell 0.5 percent and Rio Tinto (RIO.AX) eased about 0.1 percent.

DOLLAR FIRM

The dollar rose to 83.39 yen, reaching highs not seen since December 23, while the euro wallowed below $1.3200, having fallen below that level overnight for the first time since December 29.

The dollar index .DXY, which tracks the greenback's performance against a basket of major currencies, was little changed at 80.218, after topping out at a fresh one-week high of 80.353.

"As long as the key jobs data on Friday is in line with expectations, the dollar is likely keep its gains, but it looks hard for it to climb higher as the market has already priced in good numbers," said Hideki Hayashi, a global economist at Mizuho Securities.

U.S. crude oil edged up 0.1 percent to $90.42, after trading as high as $90.71, not far from a 27-month high of $92.58 set in the first trading day of the year.

(Addititional reporting by Antoni Slodkowski and Kaori Kaneko in Tokyo; Editing by Kim Coghill)

Private employers added 297,000 jobs last month, payrolls processing company ADP Employer Services said on Wednesday. It was the largest gain on ADP records dating to 2000.

The data came two days ahead of the government's more comprehensive employment report for December, the world's most closely watched economic indicator, and led many economists to raise their payrolls forecasts.

The report sparked a sharp cut in U.S. Treasury debt prices, and the U.S. dollar gained 1.5 percent against the yen, on pace for its biggest one-day gain in more than three months as investors bet on a stronger recovery. Stocks and crude oil futures reversed losses and headed higher.

"Sometimes numbers come as bolts from the blue; this is one of them," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.

"Nothing in any other indicators of the state of the labor market last month -- jobless claims, help wanted, surveys -- suggested anything like this was remotely likely."

But some economists cautioned the report may have been skewed by how ADP tracks employment and adjusts the data for seasonal fluctuations. Others said simply it is not a reliable guide to predicting the government's payroll count.

Still, the data was the latest in a series, ranging from trade to retail sales, suggesting the U.S. recovery is gaining speed.

A separate report on Wednesday showed service sector activity also picking up. The Institute for Supply Management's index of national services activity rose to 57.1 in December, the highest level in more than four years, from 55.0 in November. Economists had expected a reading of 55.6.

"Yet another number that beats consensus and keeps the positive sentiment on the economy alive with some momentum going into the new year," Sean Incremona, an economist at 4Cast Ltd in New York, said of the service sector data.

MOMENTUM INTO THE NEW YEAR

Nonfarm payrolls are now expected to have increased 175,000 in December, according to a revised Reuters poll, up from the previous pre-ADP 140,000 forecast. The jobless rate is expected to slip to 9.7 percent from November's 9.8 percent, a projection untouched by the ADP data.

Adding to the improving employment picture, the number of planned layoffs at U.S. firms fell last month to the lowest level in 10 years, according to a report by consultants Challenger, Gray & Christmas Inc.

And a survey of chief executives of small companies showed a majority planned to add employees in 2011 for the first time in three years, according to small business group Vistage.

The brighter labor market outlook is a boost for President Barack Obama, whose administration has struggled to create jobs as the economy started to recover from the huge hit it took in the financial crisis.

Morgan Stanley (MS.N), Bank of America (BAC.N) and JPMorgan (JPM.N) are among the book runners, these sources said. Bankers made their pitches to the privately-held company in November, one of the sources said.

"An IPO is just one of many tactics that we could consider," a spokesman for LinkedIn said on Wednesday. He declined further comment.

Internet companies such as LinkedIn and Zynga, a popular maker of online social games, are considering offerings well ahead of a potential IPO of Facebook, two sources said.

"Some of these companies want to go public because they want to beat Facebook and others out," said one of the sources. "If Facebook went public before Linkedin, do you think anyone would pay that much attention to Linkedin?" You might want to surpass the beast."

Zynga couldn't be reached immediately for comment.

Facebook is not expected to file for a public offering until late 2012, Facebook board member Peter Thiel told Reuters in September.

But that could change. Regulators are scrutinizing a $500 million investment and a commitment to raise at least $1 billion more in Facebook this week by Goldman Sachs and Digital Sky Technologies, one of the sources said.

The SEC is reviewing whether the number of shareholders in Facebook has exceeded a 499 limit in order to remain private. If the SEC decided Facebook has moved past the threshold, it could accelerate Facebook's timeline for an offering, the source said.

Facebook and Goldman have declined to comment.

The people familiar with the process said LinkedIn is hoping to attract investors on its reputation as one of the Web's fastest growing social network sites.

The site claims more than 85 million members.

The filing of LinkedIn's S-1 registration statement with the U.S. Securities and Exchange Commission, which contains the basic financial information of an issuer, could take months, said one of the sources.

"There are lots of things that are worked on that they could put on hold; they miss numbers; they want to grow a little more," another of the sources said.

Linkedin, which does not disclose financial results, makes money from advertising and premium services. The valuation of a Linkedin IPO was not given by the sources.

U.S. District Judge Paul Crotty found on Wednesday an "absence of ample allegations that Barclays did not truly believe" how it valued its subprime and other real estate assets, and offered "substantial risk disclosures" regarding its valuations to investors who bought its securities.

The Manhattan judge also dismissed dozens of additional defendants. Among these were Barclays directors, including current Chief Executive Robert Diamond and his predecessor John Varley, and more than one dozen underwriters such as Bank of America Corp, Citigroup Inc, Goldman Sachs Group Inc, Royal Bank of Canada and UBS AG.

The lawsuit is one of many by investors to accuse major banks of inflating their share prices by hiding or being too slow to report credit deterioration on their balance sheets.

It was brought by investors who said they bought some of the $5.45 billion of American depositary shares that Barclays issued between April 2006 and April 2008.

They said the shares lost 73 percent to 78 percent of their value by the time the lawsuit began in March 2009, and that Barclays should compensate them for losses they suffered.

David Rosenfeld, a lawyer for the investors, did not immediately return requests for comment. Barclays spokesman Brandon Ashcraft said the bank is pleased with the ruling.

The investors accused Barclays of failing to disclose in materials accompanying the ADS offerings its more than 36 billion pounds ($55.8 billion) of credit exposure, including to subprime mortgages and collateralized debt obligations.

They also said Barclays' disclosures remained inadequate until the bank took a 2.8 billion pound ($4.3 billion) writedown on subprime mortgages and other risky debt in August 2008.

In his ruling, Crotty said the plaintiffs failed to show how Barclays violated accounting and regulatory reporting rules or misled them about its risk management practices, and waited too long to bring some of their claims.

Barclays closed Wednesday up 35 cents at $17.45 in New York.

The case is In re: Barclays Bank Plc Securities Litigation, U.S. District Court, Southern District of New York, No. 09-01989.

(1 British pound = US$1.55)

(Reporting by Jonathan Stempel in New York; editing by Andre Grenon, Bernard Orr)