Wall Street rally continues after Fed rate decision

US stocks soared on Thursday, with the Nasdaq hitting a record intraday high, a day after the Federal Reserve stood pat on interest rates.

While the Fed said the risks to economic outlook were roughly "balanced," it left rates unchanged as inflation continued to run below its 2 percent target and members saw room for improvement in the labor market.

The Fed also slowed the pace of future hikes and cut its longer run interest rate forecast, but sent a strong signal for a move by the end of this year.

The consensus among economists is for a hike in December as the Fed's November meeting comes right around the US Presidential elections.

The probability of a November hike stands at a modest 12.4 percent and rises to 58.4 percent for December, according to the CME Group's FedWatch tool.

"Clearly the markets view the Fed's inaction as favorable... but if you read between the lines, the Fed is concerned about the strength of the economy," said Matt Schreiber, chief investment officer at WBI Investments in Red Bank, New Jersey.

"The Fed and central banks worldwide have been providing investors with a sense of calm and complacency."

The dollar index .DXY dropped 0.5 percent on Thursday, and was on track to mark the second straight day of losses after the central bank's decision.

Oil prices rose about 1.6 percent as the dollar fell and US crude inventories recorded a surprise drop. 

Adding some support to the Fed's plans for at least one hike this year was a report that showed the number of Americans applying for unemployment last week fell to a two-month low.

At 11:08 a.m. ET (1508 GMT), the Dow Jones Industrial Average .DJI was up 124.2 points, or 0.68 percent, at 18,417.9. All 30 of the its components were higher.

The S&P 500 .SPX was up 12.46 points, or 0.58 percent, at 2,175.58.

The Nasdaq Composite .IXIC was up 32.08 points, or 0.61 percent, at 5,327.26, after rising as much as 0.76 percent to a record of 5335.82.

The technology index .SPLRCT rose 0.5 percent, giving the benchmark S&P 500 index its biggest boost.

Shares of Amazon.com (AMZN.O) touched a record after BMO raised its price target to $900. The stock gave the S&P 500 and the Nasdaq their biggest boost.

Apple (AAPL.O) rose 0.9 percent to $114.56 and was the top influence on the S&P and the Nasdaq after Nomura and RBC raised their price targets.

JPMorgan (JPM.N) rose 0.5 percent and was the top boost on the S&P financial index .SPSY after striking a deal with Wal-Mart (WMT.N) to process payments.

Red Hat (RHT.N) rose 6.7 percent to $82.27 after the Linux operating system distributor reported second-quarter revenue and profit that beat market expectations.

Advancing issues outnumbered decliners on the NYSE by 2,537 to 417. On the Nasdaq, 1,899 issues rose and 729 fell.

The S&P 500 index showed 27 new 52-week highs and no new lows, while the Nasdaq recorded 115 new highs and nine new lows. —Reuters