US stocks rallied on Wednesday after the Federal Reserve held interest rates steady , retained its forecast for two rate cuts this year, and revised its economic projections in what some commentators called a "dovish" announcement from the central bank.
The Nasdaq Composite ( ^IXIC ) led gains, rising more than 1.4%, while the Dow Jones Industrial Average ( ^DJI ) rose 375 points, or 0.9%, and the S&P 500 ( ^GSPC ) gained 1.1%.
Stocks finished off their highs of the session, with the Nasdaq up more than 2% shortly after Fed Chair Jerome Powell's press conference wrapped.
The Fed's announcement Wednesday came as investors confront an economy dealing with the uncertainty of tariff risks this year. Powell said in a press conference he expects inflation impacts from tariffs will likely be "transitory" while recession risks remain low.
With rate cuts seen as off the table for March, the focus was on the "dot plot" — where Fed officials think rates will move next — and on Chair Jerome Powell's press conference to set expectations for future easing.
Wednesday's announcement revealed few changes from December's outlook, with nine Fed officials looking for two interest rate cuts this year while eight see there likely being only one cut or fewer.
The central bank did revise down its expectations for economic growth while revising up its forecasts for inflation this year, perhaps lowering the bar for additional rate cuts should inflation rise less than forecast.
Read more: The latest on Trump's tariffs
The Fed's view of how Trump's trade , immigration, and other policies could impact the economy — and inflation and the labor market in particular — were key focuses for investors amid g rowing worries about US growth .
Asked about these impacts, Powell said: "It is going to be very difficult to have a precise assessment of how much of inflation is coming from tariffs and from [other sources]."
On the labor market, Powell continued to point towards better balance in the job market, and said it remains a low hire, low fire environment.
On the individual stock side, Nvidia ( NVDA ) stock rose 1.8%, recoup a modset chunk of Tuesday's tech-rout losses as GTC-linked headlines rolled in. Meanwhile, Tesla ( TSLA ) shares also rebounded by more than 4.5% as Cantor Fitzgerald upgraded the stock to a "Buy" rating.
LIVE 23 updates