Asian Stocks Rise on Fed’s Rate Pledge, Weaker Yen; Mazda Rises

March 17 (Bloomberg) -- Asian stocks rose, driving the MSCI Asia Pacific Index to an eight-week high, as the U.S. Federal Reserve pledged to keep borrowing costs near zero for an “extended period” and the yen weakened.

James Hardie Industries SE, the biggest seller of home siding in the U.S., gained 1.1 percent in Sydney. Mazda Motor Corp., which gets 21 percent of its sales in Europe, rose 2.5 percent as the euro strengthened after Standard & Poor’s affirmed Greece’s credit ratings. Mitsui Mining & Smelting Co. surged 5.8 percent after boosting its profit forecast and after commodity prices rose.

“Expectations that interest rates will remain low in the U.S. are boosting demand for commodities,” said Hiroichi Nishi, an equities manager at Nikko Cordial Securities Inc. in Tokyo.

The MSCI Asia Pacific Index rose 0.7 percent to 123.82 as of 10:16 a.m. in Tokyo, set to close at the highest level since Jan. 21. The Nikkei 225 Stock Average advanced 0.7 percent in Japan, where the central bank is scheduled to announce its latest policy decisions this afternoon.

South Korea’s Kospi Index jumped 0.9 percent and Taiwan’s Taiex advanced 1 percent. The S&P/ASX 200 Index rose 0.6 percent in Sydney.

Futures on the Standard & Poor’s 500 Index were little changed. The gauge rose 0.8 percent yesterday to the highest close since October 2008 after the Fed’s rate comments. The Fed has kept the federal funds rate target for overnight loans between banks in a range of zero to 0.25 percent since December 2008. Policy makers began using the “extended period” language in March 2009 and have repeated it at each meeting since then.

The MSCI Asia Pacific Index has gained 8.4 percent from a more than two-month low on Feb. 8 as better-than-estimated U.S. jobs data and a pledge of support from French President Nicolas Sarkozy for debt-stricken Greece boosted confidence in the global recovery.

S&P affirmed Greece’s investment-grade BBB+ rating and dropped the country from “creditwatch negative,” saying the 4.8 billion euros ($6.6 billion) of budget cuts passed this month “were appropriate to achieve” the goal of cutting the European Union’s biggest deficit.

The stock rally has lifted the average price of shares in the MSCI Asia Pacific Index to 18.7 times estimated earnings, compared with 15 times for the MSCI World Index of 23 developed nations.