Wall Street ends higher on Fed statement

US stocks had finished stronger on Wednesday after the US Federal Reserve said the economy and job market continued to strengthen and left its key interest rate unchanged.

The central bank's comments on the economy and inflation after its two-day pow-wow appeared to do little to drastically change wide expectations that the first rate hike will come in September or possibly December.

No move on rates was expected this week. US interest rates have remained near zero for almost a decade and the Fed has said it will raise rates once it sees a sustained recovery in the economy.

"The statement tried to just give an update on the state of the economy, which is showing some modest improvement," said Guy Haselmann, head of US interest rate strategy at Scotiabank in New York. "They were trying not to create extra volatility in a market already on edge."

The Dow Jones industrial average rose 0.69 per cent to end at 17,751.39. The S&P 500 gained 0.73 per cent to 2,108.57 and the Nasdaq Composite added 0.44 per cent to finish at 5,111.73.

All 10 major S&P sectors were higher with the energy index's 1.28 per cent rise leading the way.

The S&P 500 has bounced about 2 per cent higher in the past two days following a deeper near-3 per cent drop over the preceding week that had been caused in part by a rout in China's stock markets.

With second-quarter earnings season more than halfway done, analysts now expect overall earnings of S&P 500 companies to edge up 0.8 per cent and revenue to decline 3.9 per cent, according to Thomson Reuters data.

While earnings are expected to increase this quarter, valuations remain a concern. The S&P 500 is trading near 16.9 times forward 12-month earnings, above the 10-year median of 14.7 times, according to StarMine data.

After the bell, Facebook and Whole Foods Market dropped 4 per cent and 11 per cent, respectively, following quarterly reports that left investors wanting more.

During the session, Twitter shares fell 14.5 per cent to a year-low of $31.24 after the microblogging company said its number of monthly average users rose at the slowest pace since it went public in 2013.

General Dynamics rose 3.93 per cent after its earnings. It sparked a sector-wide rally across major aerospace stocks including Northrop Grumman, Spirit Aerosystems , Lockheed Martin and Transdigm Group.

Cytec soared 27.06 per cent after Belgian chemical group Solvay agreed to buy the company for $5.5 billion.

Advancing issues outnumbered declining ones on the NYSE by 2.69 to 1. On the Nasdaq, the ratio was 1.28 to 1.

The S&P was chalked up 26 new 52-week highs and 1 low; the Nasdaq posted 43 new highs and 62 lows.

Some 7.2 billion shares changed hands on US exchanges, above the daily average of 6.7 billion so far this month, according to BATS Global Markets.