By Sinead Carew
(Reuters) - U.S. stocks were up in volatile afternoon trading on Thursday after the Federal Reserve held off on raising interest rates in a nod to concerns about global economic weakness.
The U.S. central bank said an array of global risks and other factors had convinced it to delay what would have been the first rate hike in nearly a decade.
The focus will now move to the next Fed meeting on Oct. 27-28. Fed Chair Janet Yellen was due to hold a press conference at 2:30 p.m ET (1830 GMT).
Afternoon trading was choppy and the three major U.S. indexes were up less than one percent after hitting session highs and then briefly turning negative after the news.
The news left investors still trying to figure out the timing for the Fed's first benchmark rate increase since 2006.
Uncertainty about when the Fed will shift gears has dogged Wall Street for months - a situation that has been complicated in recent weeks by market turbulence linked to slowing growth in China and worries about the health of the global economy.
The Fed had said it will raise rates when it sees a sustained recovery in the economy.
"The Fed did the right thing. There's no need to rock the boat right now. Again the disconcerting element is the downgrade to the interest rate trajectory, which could provide solace to investor sentiment overall," said Brian Dolan, head market strategist at Drivewealth in New Jersey. "Given the global headwinds, the last thing we need right now was a hike in rates and any kind of hawkish projections."
At 2:16 p.m., the Dow Jones industrial average <.DJI> rose 36.68 points, or 0.22 percent, to 16,776.63, the S&P 500 <.SPX> gained 6.92 points, or 0.35 percent, to 2,002.23 and the Nasdaq Composite <.IXIC> added 22.53 points, or 0.46 percent, to 4,911.76.
Ahead of the news, U.S. interest rates futures indicated a 25 percent chance the central bank would raise rates on Thursday, while 35 of 80 economists polled by Reuters earlier this week said they expected a move.
Seven of the 10 major S&P sectors were higher, with the utilities index's <.SPLRCU> 1.4 percent rise leading the way. The telecommunications index <.SPLRCL> was off 1.4 percent.
Advancing issues outnumbered declining ones on the NYSE by 2,055 to 912, for a 2.25-to-1 ratio on the upside; on the Nasdaq, 1,696 issues rose and 1,064 fell for a 1.59-to-1 ratio favouring advancers.
The S&P 500 posted 12 new 52-week highs and 2 new lows; the Nasdaq recorded 47 new highs and 28 new lows.
(Reporting by Tanya Agrawal; Editing by Ted Kerr and Nick Zieminski)
