By Rodrigo Campos
The Fed, which raised its target rate by 25 basis points to 0.75 to 1.00 percent, did not however flag any plan to accelerate the pace of monetary tightening, a concern that had lingered among some market participants.
Markets were expecting the Fed's decision and traders had priced in more than a 90 percent chance of a quarter-point rate increase, according to federal funds futures.
"The concern heading into this meeting was that the Fed would show more urgency in increasing interest rates beyond three rate hikes. The statement and the forecast ... imply that they're staying the course," said Frances Donald, senior economist at Manulife Asset Management in Toronto.
"The additional risk of moving more hawkishly doesn't seem to be present here."
The Dow Jones Industrial Average <.DJI> rose 124.5 points, or 0.6 percent, to 20,961.87, the S&P 500 <.SPX> gained 22.5 points, or 0.95 percent, to 2,387.95 and the Nasdaq Composite <.IXIC> added 50.81 points, or 0.87 percent, to 5,907.63.
Financials on the S&P 500 <.SPSY> were the worst-performing sector while real estate <.SPLRCR>, up 2.2 percent, was on track to post its largest daily gain since branching out as the 11th S&P sector last September.
U.S. retail sales recorded their smallest gain in six months in February, setting U.S. gross domestic product on track to grow at a 0.8 percent annualised pace in the first quarter, according to the Atlanta Fed's latest forecast.
Energy stocks boosted the S&P 500 as oil prices rose for the first time in more than a week on a surprise drawdown in U.S. crude inventories. U.S. crude
Advancing issues outnumbered declining ones on the NYSE by a 7.91-to-1 ratio; on Nasdaq, a 2.68-to-1 ratio favoured advancers.
The S&P 500 posted 74 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 121 new highs and 41 new lows.
(Additional reporting by Sam Forgione and Sinead Carew; Editing by James Dalgleish and Nick Zieminski)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)