The Nasdaq hit a record intraday high on Thursday amid broad gains in U.S. stocks, a day after the Federal Reserve stood pat on interest rates.
While the risks to economic outlook were roughly “balanced”, the Fed maintained rates as inflation continued to run below its 2% target and members saw room for improvement in the labor market.
The central bank slowed the pace of future hikes and cut its longer run interest rate forecast to 2.9 percent from 3 percent, but sent a strong signal for a move by the end of this year.
“The Fed probably appeared less hawkish than what the markets had expected,” said Ryan Larson, head of equity trading at RBC Global Asset Management in Chicago. “I think the market continues to be focused on the Fed pushing a hike for later as a good thing rather than bad.”
The consensus among economists is for a hike in December as the Fed’s November meeting comes right around the U.S. Presidential elections.
The probability of a November hike stands at a modest 12.4 percent, and rises to 58.4 percent for December.
The dollar index dropped 0.6 percent on Thursday, and was on track to mark the second straight day of losses after the central bank’s decision.
Oil prices rose about 1.8 percent as the dollar fell and U.S. crude inventories recorded a surprise drop.
At 9:36 13:36 GMT, the Dow Jones Industrial Average was up 132.52 points, or 0.72 percent, at 18,426.22.
The S&P 500 was up 15.01 points, or 0.69 percent, at 2,178.13.
The Nasdaq Composite was up 32.98 points, or 0.62 percent, at 5,328.22, after rising as much as 0.65 percent to a record of 5329.92.
The S&P energy index surged 1.33 percent and was the top gainer among the 11 major sectors of the benchmark index.
Adding some support to the Fed’s plans for at least one hike this year was a report that showed the number of Americans applying for unemployment last week fell to a two-month low.
Shares of Apple rose 0.9 percent to $114.56 and was the top influence on the S&P and the Nasdaq after Nomura and RBC raised their price targets.
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