The market had been lower before the Fed released its statement, which highlighted strength in hiring and housing, but weakness in exports and concerns over slower global economic growth. The Fed now expects to raise interest rates two times this year instead of four.
Stocks are now on track for their fifth straight week of gains and the& Dow& Jones industrial average and Standard & Poor’s 500 index closed at their highest levels since the first trading day of the year.
The& Dow& gained 74.23 points Wednesday, or 0.4 percent, to 17,325.76. The S&P 500 index rose 11.29 points, or 0.6 percent, to 2,027.22. The Nasdaq composite index rose 35.30 points, or 0.8 percent, to 4,763.97.
Oil prices rose nearly 6 percent and pushed energy shares sharply higher. Crude jumped after a group of major energy producing nations said they will hold more talks next month about a freeze in oil output levels. A deal could help relieve a global glut that has depressed oil prices. In the U.S., oil inventories grew, but not as much as investors expected.
Benchmark U.S. crude rose $2.12 to $38.46 a barrel in New York. Brent crude, the benchmark for international oils, rose $1.59, or 4.1 percent, to $40.33 a barrel.
Energy companies were the top-performing sector on the market. Devon Energy gained $2.13, or 8.8 percent, to $26.22 Southwestern Energy rose 67 cents, or 9.3 percent, to $7.90 and Oneok added $1.79, or 6.5 percent, to $29.51.
After the Fed’s decision, bond prices rose sharply and the yield on the 10-year Treasury note fell to 1.91 percent from 1.97 percent. The euro jumped to $1.1217 from $1.1107 late Tuesday. The dollar fell to 112.55 yen from 113.10 yen.
Metals prices were little changed on the day, as they closed earlier in the afternoon. Gold lost $1.20 to $1,229.80 an ounce. Silver decreased 4 cents to $15.22 an ounce. Copper was unchanged at $2.23 a pound.
Stocks have been rising in recent weeks on mounting evidence that the U.S. economy remains in good shape overall despite the shaky state of other major economies. That trend continued Wednesday as the Labor Department said core inflation, or inflation that leaves out energy and food prices, continued to rise. It’s up 2.3 percent over the last year, its biggest 12-month gain since May of 2012. Overall inflation slipped in February because of lower gas prices and it’s up just 1 percent in the last year.
The Fed has been looking closely at inflation as it considers raising interest rates. Though one of the Fed’s main goals is to prevent runaway inflation, it wants to see inflation rise more than it has in recent years to be sure the economy is healthy enough to handle higher rates.
In other energy trading, wholesale gasoline rose 1 cent to $1.42 a gallon. Heating oil gained 5 cents, or 4.5 percent, to $1.23 a gallon. Natural gas rose 2 cents to $1.87 per 1,000 cubic feet.
Germany’s DAX gained 0.5 percent and Britain’s FTSE 100 added 0.6 percent. France’s CAC 40 fell 0.2 percent. Asian stocks were also mixed, as Japan’s benchmark Nikkei 225 slipped 0.8 percent and South Korea’s Kospi added 0.3 percent. Hong Kong’s Hang Seng lost 0.2 percent while the Shanghai Composite index rose 0.2 percent.