The Nasdaq composite notched its best gain in nearly four months, while the Standard & Poor’s 500 had its strongest advance in a month.

The Fed’s inaction was expected but investors were pleased that policymakers indicated rates would probably remain at current low levels for some time. The news was particularly welcome after a strong consumer confidence report earlier in the day.

"The Fed statement appeased pretty much everyone," said Keith Keenan, vice president of institutional trading at Wall Street Access, a New York-based brokerage firm. "They hit all the right notes."

"Equity investors wanted them to keep rates low for the foreseeable future. ... And they appeased bond investors by saying inflation was not anywhere in sight," he said.

The Dow closed up 140.15, or 1.5 percent, at 9,748.31, having gained 25.70 the previous session. It was the best one-day point gain since Oct. 1, when the blue-chip average rose 194.14 points.

The broader market also moved sharply higher. The Nasdaq composite index gained 49.35, or 2.6 percent, to 1,932.26. It was the biggest gain since July 7, when the tech-focused index rose 57.25.

The Standard & Poor’s 500 index rose 15.66, or 1.5 percent, to 1,046.79. It was the best advance since Oct. 1, when the index gained 22.25.

Stocks already were trading higher before the Fed decision following an upbeat economic report. The Conference Board said its consumer confidence index rose to 81.1 this month from 77 in September. The business research group said consumers were encouraged by signs of a stronger job market.

Meanwhile, the Commerce Department said new orders for big-ticket goods rose by 0.8 percent in September after a 0.1 percent decline in the previous month. September’s reading was slightly lower than forecasts; however, the August number was revised upward today from the 1.1 percent drop initially reported.

Analysts cautioned, though, that the market’s advance would likely be limited in the weeks ahead. With the earnings season drawing to an end, Wall Street will need another catalyst to inspire more strong buying.

"It’s going to take a lot to move from here," said John Lynch, chief market analyst at Evergreen Investments. "But a break from the big move is a healthy thing for the market. I’m not opposed to listlessness or some pullback given the sprint we’ve been in."