On the data front, U.S. economic growth slowed in the second quarter amid a widening in the trade deficit, increasing at a 1.5% rate versus estimates of 2.1% growth. A separate reading also showed U.S. inflation slowed in June.
At 09:50 a.m. ET, the Dow Jones Industrial Average .DJI rose 290.48 points, or 0.56%, to 51,884.62, the S&P 500 .SPX gained 81.98 points, or 1.12%, to 7,398.13 and the Nasdaq Composite .IXIC gained 542.32 points, or 2.22%, to 24,985.26.
Technology stocks .SPLRCT led gains among the major S&P sectors, rising 4.2%.
Chips also climbed early on, with the Philadelphia chips index .SOX up 6.7%, set to snap a five-day losing streak.
Markets closed sharply lower on Wednesday after the Fed left interest rates unchanged in the 3.50% to 3.75% range, but mixed messages from new Fed Chair Kevin Warsh left traders confused about the path of borrowing costs.
“
The hold on rates is justified when you're looking at the downward movement of the PCE numbers,
” Rathbun said.
Bond markets were on edge, with the yield on the 30-year Treasury bond US30YT=RR surging to its highest level in 19 years, as investors grew increasingly concerned about the central bank's monetary-policy outlook and sought greater protection against future inflation.
Traders currently see a 57% chance that the U.S. central bank will raise interest rates by 25 basis points at its September meeting, according to LSEG-compiled data.
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