US stocks rally after Fed rate decision

US stocks ended higher after the US Federal Reserve kept its benchmark short- term interest rates unchanged as widely expected.

The Dow Jones Industrial Average rose 74.23 points, or 0.43 percent, to 17,325.76 on Wednesday, Xinhua news agency reported.

The S&P 500 added 11.29 points, or 0.56 percent, to 2,027.22. The Nasdaq Composite Index increased 35.30 points, or 0.75 percent, to 4,763.97.

After the conclusion of its two-day policy meeting, the US central bank on Wednesday decided to keep its benchmark interest rates unchanged, noting that "global economic and financial developments continue to pose risks" to the US economy.

In a statement released on Wednesday, the Fed said US "economic activity has been expanding at a moderate pace despite global economic and financial developments in recent months," but these developments continue to pose risks.

The Fed also cut its GDP growth outlook for 2016 from 2.4 percent to 2.2 percent and reduced 2017's call from 2.2 percent to 2.1 percent, according to the latest Summary of Economic Projections.

"The Fed shifted from a dot plot suggesting 4 rate hikes this year to one suggesting 2. It will take a while for markets to settle on what the new dots mean. On one hand, a less aggressive Fed means higher inflation. On the other hand, the Fed is telling us they are no longer as concerned about inflation as in December," said Chris Low, chief economist at FTN Financial.