NEW YORK: US stocks rebounded Wednesday after the Federal Reserve's policymakers kept ultra-low interest rates and said they were prepared to do more if needed to stimulate the sluggish economy.
The Dow Jones Industrial Average gained 178.08 points (1.53 percent) to finish at 11,836.04, ending a two-day sell-off.
The tech-heavy Nasdaq Composite added 33.02 points (1.27 percent) to 2,639.98, while the S&P 500-stock index, a broader measure of the markets, advanced 19.62 points (1.61 percent) to 1,237.90.
Concluding a two-day meeting, the Federal Open Market Committee left monetary policy unchanged, saying economic growth had "strengthened somewhat" in the third quarter.
The Fed "is prepared to employ its tools to promote a stronger economic recovery in a context of price stability," the FOMC said in a statement.
"Stocks got an added boost from Ben Bernanke's press conference following the statement, as the chairman said the Fed may look to reinvest in mortgage-backed securities to provide additional support to the struggling housing market," Charles Schwab analysts said.
Sentiment also was aided by better-than-expected private-sector job creation last month reported by payrolls firm ADP ahead of Friday's government October labor report.
Wall Street kept an eye on developments in Europe, where a planned Greek referendum on the country's latest European Union rescue has sparked fears the country will default on its debt, and possibly leave the eurozone.
"Investors remain hopeful Europe will keep its rescue plan on track. The region's leaders convened an emergency meeting ahead of the G20 summit to tell Greek Prime Minister (George) Papandreou there are no alternatives to the bailout," said Scott Marcouiller at Wells Fargo Advisors.
On the blue-chip Dow, Bank of America was the biggest gainer, its shares up 5.00 percent at $6.72 after heavy losses Tuesday linked to Europe's debt crisis and a decision to abandon debit card fees amid customer outrage.
The quarterly earnings season, which is winding down, produced some strong performances.
Media group Time Warner rose 0.8 percent to $33.57 after reporting a 57 percent profit increase and raising its full-year outlook.
Cable operator Comcast rose 0.2 percent to $23.02 after earnings rose but not as much as the market expected.
AOL, whose earnings beat forecasts, soared 12.5 percent to $15.02.
The bond market slipped. The yield on the 10-year Treasury rose to 2.01 percent from 2.00 late Tuesday, while that on the 30-year Treasury climbed to 3.04 percent from 3.00 percent.
Bond yields and prices move in opposite directions.
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