Dow gains as Fed keeps rates low

New York - The Dow jumped nearly 300 points on Wednesday after the US Federal Reserve made no changes to its monetary policy, saying it can remain "patient" before moving to raise interest rates.

The Dow Jones Industrial Average gained 288.00 points (1.69%) at 17 356.87.

The broad-based S&P 500 soared 40.15 (2.04%) to 2 012.89, its best one-day gain of the year, while the tech-rich Nasdaq Composite Index advanced 96.48 (2.12%) to 4 644.31.

US stocks were in the green all day, but rose significantly after the Fed announcement in the early afternoon. The S&P 500 roughly doubled its gains in the final two hours of trade.

In the statement, the Federal Open Market Committee, the Fed's policy arm, left in place expectations that the central bank may raise interest rates only in the middle of 2015, downplaying speculation that a hike might come earlier than that because of the strength of the US economy.

Fed chair Janet Yellen, speaking at a news conference after the two-day FOMC meeting, said that the US economy is "strengthening" but that decisions to raise rates remained data-dependent.

"There are no major surprises," said Art Hogan, chief market strategist at Wunderlich Securities. "But we have a statement that was perhaps less hawkish than expected, and then a succesful press conference" with Yellen.

Wednesday's gains snapped a three-day losing streak in US stocks amid concerns over the sharp fall in oil prices and a big drop in the Russian ruble.

Petroleum-linked stocks were especially big winners as oil prices rose. Dow members ExxonMobil and Chevron gained 3.0% and 4.3%, respectively, while oil-services giant Schlumberger put on 3.4%.

Major banks bolted higher, including Dow member JPMorgan Chase (+2.3%) and Bank of America (+3.2%).

Cruise companies rose as the US and Cuba announced an historic rapprochement and launched measures to ease a five-decade US trade embargo. Carnival Cruise gained 3.5%, while Royal Caribbean Cruises jumped 6.6%.

Package-delivery giant FedEx fell 3.7% despite reporting a 23% gain in fiscal second-quarter earnings to $616m. The results translated to $2.14 per share, eight cents shy of Wall Street expectations as the company benefited less than anticipated from lower fuel prices.

Bond prices fell. The yield on the 10-year US Treasury jumped to 2.15% from 2.07% on Tuesday, while the 30-year rose to 2.75% from 2.70%.