NEW YORK (TheStreet) -- Stocks held onto modest gains late Wednesday afternoon after crude oil closed nearly 6% higher. 

The S&P 500 was up 0.64%, the Dow Jones Industrial Average added 0.63%, and the Nasdaq gained 0.31%.

Crude moved higher after crude supplies dropped by 2.1 million barrels in the week ended Sept. 11, according to the Energy Information Administration. Economists had expected weekly inventories to drop by 200,000 barrels. West Texas Intermediate crude added 5.7% to $47.15 a barrel.

The energy sector was the best performer on markets. Among the major oilers, Exxon Mobil(XOM) - Get Report , PetroChina(PTR) - Get Report , Royal Dutch Shell (RDS.A) , Total(TOT) - Get Report and Chevron(CVX) - Get Report were all higher. The Energy Select Sector SPDR ETF (XLE) - Get Report added 2.1%.

Investors await Thursday's decision from the Federal Reserve on interest rates. Fed members could decide to hike rates for the first time in nearly a decade at their two-day September meeting which ends Thursday. Economists are torn as to whether the Fed will raise rates. On one side of the argument, economists said recent domestic economic strength warrants liftoff from crises-level rates. On the other, recent global market turmoil could give the Fed pause in tinkering with monetary policy.

"I'm still in the camp that they're going to start, it's going to be a 25-basis point initial hike and then it's going to be a wait-and-see approach in the Fed to see how the global economy, the U.S. economy and markets react to that," argued Kevin Mahn of Hennion & Walsh Asset Management. 

But weaker inflation could give the Fed pause. U.S. consumer inflation fell in August for the first time this year, driven by a decline in gasoline prices last month, according to the Consumer Price Index. Consumer prices fell 0.1% compared to economists' forecasts of no change. Energy prices fell 2% over the month, while food prices increased 0.2%.

"This deterioration in the inflationary backdrop is likely to factor prominently in the Fed's deliberation over the next two days, and it could potentially tip the balance towards a hold on rates as the re-emergence of the dis-inflationary thrust will argue for caution," argued Millan Mulraine, deputy chief U.S. macro strategist at TD Securities, in a note. 

Homebuilder confidence rose to its highest level in a decade in September, according to the National Association of Home Builders/Wells Fargo housing market index. The measure, which records confidence in demand for newly constructed single-family homes, climbed to 62, above an expected reading of 61.

Anheuser-Busch InBev(BUD) - Get Report shares surged more than 6% after approaching competitor SABMiller (SBMRY) about a potential takeover. SABMiller said it knew of plans to make an offer but had yet to receive a formal proposal. The two are the largest beer companies in the world based on the volume sold each year and a deal could be valued at up to $250 billion, according to reports.

In other deals news, Starz (STRZA) jumped more than 4% on reports AMC Networks(AMC) - Get Report is in talks to acquire the TV programmer. Fresh talks follow on from failed discussions last year which broke down over valuation.

Fiat Chrysler(FCAU) - Get Report and the United Auto Workers announced a tentative agreement on Tuesday night, potentially putting an end to two days of talks over worker benefits and a two-tier pay system. Fiat acted as the lead representative for the Detroit's biggest automakers including Ford(F) - Get Report and General Motors(GM) - Get Report .

Hewlett-Packard(HPQ) - Get Report moved higher after announcing plans to cut another 25,000 to 30,000 jobs from its enterprise IT operations. The company announced 55,000 job cuts earlier in the year. The job cuts come as Hewlett-Packard plans to split its enterprise business from its printer and PC business.

FedEx(FDX) - Get Report fell 3% after missing quarterly profit estimates. The delivery company earned $2.42 a share in its first quarter, 4 cents shy of estimates, though revenue jumped 5.3% to $12.3 billion. FedEx also lowered its full-year earnings outlook to as high as $10.90 a share. The company also announced a rate increase of 4.9% to be implemented Jan. 4.

United Natural Foods(UNFI) - Get Report shares edged higher after the company reported in-line earnings for its recent quarter. The health foods company earned 72 cents a share on revenue of $2.06 billion. Total sales jumped 17% from a year earlier.

Cracker Barrel(CBRL) - Get Report moved higher after a mixed fourth quarter. The restaurant chain reported net income of $1.97 a share, 11 cents above estimates, while revenue of $719.2 million fell short of forecasts.