Stocks Give Thumbs Up to Fed

Earlier, the Energy Department said oil inventories unexpectedly dropped by 3.9 million barrels last week, while gasoline and distillate inventories rose slightly.

Treasury prices slid, with the 10-year note losing 19/32 in price, pushing the yield to 4.46%. The 30-year bond fell 26/32 in price, yielding 4.73%. The dollar rebounded after having set new lows against the euro.

Breadth was positive. On the New York Stock Exchange 2.55 billion shares changed hands, as advancers topped decliners by a 12-to-5 margin. Volume on the Nasdaq reached 2.46 billion shares, with winners edging losers nearly 3 to 2.

The gains that followed the Fed's decision pushed the Dow into positive territory for October. The blue chip average ended the month up 0.2%. The S&P 500 added 1.5%, and the Nasdaq surged 5.8%, its best monthly performance since July 2005.

Commodity-related indices had the best performance for the session. The Philadelphia Gold & Silver Sector Index jumped 3.7%, the Philadelphia Oil Service Sector Index was higher by 2.6%, and the Amex Oil Index added 2%.

Interestingly enough, transportation stocks also fared well despite rising oil prices. The Nasdaq Transportation Index rose 2.3% and the Dow Jones Transportation Average gained 1.4%.

Before of the Fed's announcement, traders scrutinized several releases on the economic docket. The Commerce Department released its advance read on third-quarter gross domestic product, which beat expectations with a 3.9% increase.