Equities rallied into the close Wednesday as the Federal Reserve retained its forecast for three rate cuts this year while revising up its growth forecast. The Dow Jones industrial average rose 1.0 percent, the S&P 500 gained 0.9 percent to set a new closing high, and the Nasdaq was up 1.3 percent. US Treasury yields and oil prices declined while the dollar rose.

Markets added to their initial gains on the Fed's policy statement after Fed Chair Jerome Powell told reporters that recent inflation figures had not altered expectations for a gradual decline in price pressures. That reassured investors who went into the day concerned that Powell would come across as more hawkish after higher than expected inflation readings and signs of robust growth.

Among sectors, big technology shares had another good day. Other winners included chipmakers, banks, media, homebuilders, transports and small caps. On the downside, energy stocks lagged with a retreat in oil prices. Food, health & personal care, health care, and utilities lagged too.

Among chipmakers, Intel advanced on news the US would grant the firm up to $8.5 billion to subsidize domestic chip production. Retailer PDD was another notable winner after the owner of online platform Pinduoduo and Temu posted a huge earnings beat. Chipotle advanced after announcing a stock split. Paramount popped up on news of a huge takeover bid from Apollo.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.