Nikkei hits 8-wk high on Fed policy surprise, commodities stocks soar
* Sentiment buoyed after Fed surprises with no taper
* Commodity shares lead Nikkei's rally
* Exporters underperform as dollar pressured on Fed's decision
TOKYO, Sept 19 (Reuters) - Japan's Nikkei share average rose to an eight-week high on Thursday morning, led by commodity stocks after the U.S. Federal Reserve stunned markets by deciding not to start tapering its massive monetary stimulus just yet. The Nikkei rose 1.2 percent to 14,675.41 in mid-morning trade after surging to a high of 14,686.20, the highest level since late July. After months of speculation about the Fed's intentions, the no-taper news triggered a rally in riskier assets which have been supported in recent years by the U.S. central bank's easy money policies. Commodity stocks soared as the extension of U.S. stimulus was seen as bolstering global demand for commodities. Sumitomo Metal Mining Co jumped 7.1 percent, Mitsui Mining and Smelting Co advanced 3.8 percent and Mitsubishi Materials Corp added 2.2 percent. "Global stock traders, currency dealers and commodity managers are all unwinding their positions," said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities, adding that the index may attempt a July high of 14,953.29 in the near term if emerging markets put in consistently strong performances. Currencies and stocks in emerging countries were battered in recent months on worries that the Fed's tapering could prompt an exodus of capital out of the region. U.S. stocks rallied to record highs on Wednesday after the Fed took markets off guard and said it wanted to wait for more evidence of solid economic growth before trimming its stimulus. Moreover, Fed Chairman Ben Bernanke refused to commit to begin reducing the bond purchases this year, and instead went out of his way to stress the program was "not on a preset course." Exporters underperformed as the dollar skidded to a three-week low of 97.76 yen. It last traded at 98.20 yen. Sony Corp dropped 0.3 percent, Honda Motor Co added 0.1 percent, while Panasonic Corp shed 0.1 percent. The Topix added 0.9 percent to 1,203.60. Toru Ibayashi, executive director at UBS Securities, said the market has priced in the outlook for the current business year through March 2014, which is expected to see a 50 percent rise in companies' operating profits. For the following year, companies are seen positing a 10 percent rise in operating profits, he said. "If the dollar stalls below 100 yen and the outlook stays as it is, the Nikkei's gains will likely be limited." A stronger yen erodes exporters' competitive abroad as well as their dollar-earnings when repatriated. The benchmark Nikkei is up around 40 percent this year, underpinned by the Japanese government's aggressive monetary and fiscal stimulus, but is still down about 10 percent since its May peak of 15,942.60.