Stocks jumped Wednesday afternoon after Federal Reserve Chair Janet Yellen recommitted to a gradual rate hike timeline.
The S&P 500 was up 0.7%, the Dow Jones Industrial Average rose 0.57%, and the Nasdaq gained 0.8%.
The Fed will continue to pursue gradual tightening, Yellen said in a press conference following the central bank's two-day meeting that ended Wednesday. The Fed held rates unchanged, a move Yellen described as "prudent." Only one hawk, Kansas City Fed President Esther George, voted to hike rates at this meeting.
The central bank now expects two rate hikes this year, down from December's forecasts for four hikes over 2016. The Fed also cut its forecasts for next year's hikes by 50 basis points.
"Tightening should continue (slowly) because employment continues to improve, fulfilling part of their mandate, while the resulting tightness in some labor markets is leading to wage inflation pressures, which affects the other part of their mandate," said Jason Pride, director of investment strategy at Glenmede.
The central bank upgraded its assessment of the U.S. economy, particularly inflation. Members expects full-year GDP growth of 2.2%, down from 2.4% previously forecast. However, members also upgraded their concern over global economic developments.
Crude oil extended gains after the Energy Information Administration reported a 1.3-million-barrel increase in inventories over the past week, far below estimates of 2.7 million barrels.
Oil was already higher on hopes members of the Organization of Petroleum Exporting Countries can agree upon a production freeze at an April meeting. Members will meet in Qatar on April 17 without Iran in attendance. Iran had previously said it wouldn't commit to a freeze as it works to ramp up production to pre-sanction levels.