Wall Street firms 1% on boost from tech stocks; Dow rises 480 points

US stock indexes opened higher on Thursday on a boost from tech-focused megacap firms a day after hawkish comments from the Federal Reserve weighed on markets.

Leading gains on the benchmark S&P 500 was a 18.4% surge in hard-disk maker Seagate Technology's shares followed by a 13.5% jump in digital workflow company ServiceNow Inc.

Both the companies reported better-than-expected quarterly results.

Netflix Inc jumped 7.0% as billionaire investor William Ackman amassed a new stake in the streaming service company worth more than $1 billion.

Apple, Microsoft and Alphabet gained nearly 2% each, with the iPhone maker set to report results after markets close.

All the 11 major S&P sectors advanced in early trading, with technology and energy posting the sharpest percentage gains.

"We believe the biggest opportunity in markets right now is in dividend growth stocks that have strong balance sheets and cash flows, and can thrive in an environment no matter what the Fed does," said David Bahnsen, chief investment officer at the Bahnsen Group.

The Fed indicated on Wednesday a rate hike in March and reaffirmed plans to end its bond purchases that month before launching a significant reduction in its asset holdings, with Chair Jerome Powell warning that inflation and supply problems are more persistent than previously thought.

Traders priced in nearly five rate increases by December following the announcement, after fully pricing for four previously.

The S&P 500 hit a three-month low last week as fears over uncertainty around Fed policy tightening hit richly valued growth stocks. Festering geopolitical tensions in Ukraine between Russia and the West have also added to investor concerns.

The S&P 500 index fell in the previous session amid volatile trading, flirting with a correction for its third straight session.

The bellwether index would have to close 10% or more below its record closing high reached on Jan. 3 to confirm it entered correction territory. It ended the last session 9.3% below that level on Wednesday.

"As the market digests (Fed's comments) over the next couple of sessions, they may feel more comfort knowing that quantitative tightening is some ways off and the rate hikes were already known and priced in," said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

At 9:58 a.m. ET, the Dow Jones Industrial Average was up 482.60 points, or 1.41%, at 34,650.69, the S&P 500 was up 63.50 points, or 1.46%, at 4,413.43, and the Nasdaq Composite was up 170.15 points, or 1.26%, at 13,712.27.

Latest data showed the U.S. economy grew by 6.9% in the fourth quarter, far ahead of economists' expectations of 5.5% growth.

Meanwhile, the fourth-quarter earnings season is in full swing. Analysts expected earnings from S&P 500 companies to grow 24.4% year-over-year, according to Refinitiv, as of Wednesday.

Tesla Inc slipped 5.0% after warning that supply chain issues will last throughout 2022, while Intel Corp fell 7.1% on a downbeat first-quarter earnings forecast also due to global supply chain problems.

Advancing issues outnumbered decliners by a 3.90-to-1 ratio on the NYSE and by a 2.04-to-1 ratio on the Nasdaq.

The S&P index recorded 16 new 52-week highs and three new lows, while the Nasdaq recorded 14 new highs and 84 new lows.