1st LD Writethru: U.S. stocks soar after dovish Fed statement

U.S. stocks swung sharply to gains Wednesday after the release of the policy statement from the Federal Reserve, as investors cheered the more dovish than expected Fed tone.

The Dow Jones Industrial Average surged 227.11 points, or 1.27 percent, to 18,076.19. The S&P 500 jumped 25.22 points, or 1.22 percent, to 2,099.50. The Nasdaq Composite Index added 45.39 points, or 0.92 percent, to 4,982.83.

"The Committee judges that an increase in the target range for the federal funds rate remains unlikely at the April FOMC meeting, " the Fed said in the statement after a two-day meeting of its Federal Open Market Committee (FOMC), the Fed's chief body for monetary policy, noting that the U.S. economic growth "has moderated somewhat" since January.

But the central bank dropped its pledge to be "patient" in beginning to raise interest rates from the statement, paying the way for an interest rate hike as soon as June, according to analysts.

The Fed said it will "be appropriate" to raise the interest rate when it has seen "further improvement" in the labor market and is "reasonably confident" that inflation will move back to its target of 2 percent in the medium term.

In a press conference following the statement's release, Fed Chair Janet Yellen said that the timing of a raise was data dependent.

The Fed has kept its benchmark short-term interest rates near zero since late 2008.

"Removing patient does not mean the Fed is impatient, Yellen said in her press conference. The Fed expects to wait until June at least for liftoff, but liftoff could come any time after June. She also reminded us, policy will remain highly accommodative even after the first hike," said Chris Low, chief economist at FTN Financial, in a note.

On the economic front, U.S. weekly mortgage applications, a measure of mortgage loan application volume, decreased 3.9 percent on a seasonally adjusted basis, reported the Mortgage Bankers Association Wednesday.

In corporate news, shares of Alibaba ticked up 0.11 percent to 84.59 dollars apiece Wednesday, as the Chinese e-commerce giant's first lock-up arrangement expired.

According to Alibaba Group, approximately 437 million ordinary shares subject to the 180-day lock-up period described in the company's IPO prospectus were available for sale to the public Wednesday.

Of those 437 million ordinary shares, roughly 100 million shares will nevertheless remain subject to Alibaba's employee trading restrictions until after the announcement in May 2015 of its earnings results for the quarter and fiscal year ending March 31, 2015.

There are different lock-up periods for different shareholders, and stocks held by Alibaba's largest shareholders will remain frozen until the company's IPO anniversary in September. Endite