US stocks jumped sharply last night after the Federal Reserve voted unanimously to hold interest rates steady and said it would keep borrowing costs low for "a considerable period."
The Dow Jones industrial average surged 140.15 points, or 1.46 per cent, to close at 9,748.31, its biggest daily percentage gain in four weeks.
But the tech-laden Nasdaq scored its biggest daily gain since July in heavy trading, headed by chip-makers and associated companies, on news that the World Semiconductor Trade Statistics group raised its 2003 forecast for worldwide chip sales and saw even stronger growth in 2004.
The Nasdaq ended up 49.35 points, or 2.62 per cent, at 1,932.26. The broad Standard & Poor's 500 climbed 15.66 points, or 1.52 percent, to finish at 1,046.79.
Keeping interest rates at 45-year lows, the Fed said low inflation was its major concern. It hinted at keeping rates at bay in the forseeable future to keep the economy rolling along.
US Treasuries, down before the Fed's statement, rallied on the announcement that interest rates would be kept low and that the Fed would stick to its pledge to hold credit costs down for some time to curb inflation.
The Fed made only one small change from its previous pronouncement on the US economy, saying the labour market appeared to be stabilising - a shift from previous statements that characterised the job market as weakening.