Stocks rallied Thursday after the Federal Reserve signaled that it may move slowly to raise interest rates.

While the central bank left open the possibility of a rate increase later in the year, policymakers also lowered their assessment of the economy and noted that inflation was likely to remain low.

"The Fed removed the word 'patient' from its statement about waiting to raise interest rates, but everything else about its outlook indicates almost perpetual patience," Rob Williams, deputy editor of NewsmaxFinance, said on "The Steve Malzberg Show" on Newsmax.TV. "Stocks will likely hit a record in the next week on the Fed's lack of conviction about a rate hike."

Story continues below video of NewsmaxTV's market commentary.

Stocks swung from losses earlier in the day to big gains after the statement was released. Bonds also rallied, pushing the yield on the 10-year Treasury note back below 2 percent. The dollar plunged against the euro.

"There is very little to suggest that the Fed is going to raise rates aggressively this year," said Jeremy Zirin, an investment strategist at UBS Wealth Management.

The Standard & Poor's 500 index rose 25.14 points, or 1.2 percent, to 2,099.42. The index had been down as much as 11 points before the release of the Fed's statement at 2:00 p.m.

The Dow Jones industrial average gained 227.11 points, or 1.3 percent, to 18,076.19. The Nasdaq composite rose 45.39 points, or 0.9 percent, to 4,982.83.

Energy companies led the gains for stocks as the price of oil spiked after the Fed's statement. Lower rates tend to make oil and other hard assets more attractive investments, increasing their prices. The energy sector in the S&P 500 jumped 2.9 percent.

Benchmark U.S. crude rose $1.20 to close at $44.66 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, rose $2.40 to close at $55.91 a barrel in London.

Fed policymakers have held their benchmark interest rate close to zero since 2008 to help the economy recover from the Great Recession. Low rates make it easier for businesses and consumers to borrow and spend. They have also helped the stock market soar over the past six years, pushing major stock indexes to record levels.

The Fed's statement confirmed that stocks remain in a "Goldilocks" environment, where growth is solid, but not strong enough to stoke inflation, said Zirin at UBS.

"This still seems to be the sweet spot for equity investors, where you should see decent, but unspectacular earnings gains," he said.

In currency trading, the dollar slumped, reversing a recent surge against the euro.

The U.S. currency traded lower against the euro, weakening almost 3 percent to $1.0894. The dollar had traded as low as $1.05 earlier in the week.

The dollar weakened to 119.85 yen from 121.34 yen late Tuesday.

U.S. government bond prices jumped. The yield on the 10-year Treasury note fell to 1.92 percent from 2.08 percent on Tuesday, a sharp move lower.

Metals were mixed. Gold rose $3.10, or 0.3 percent, to $1,151.30 an ounce. Silver fell four cents, or 0.2 percent, to $15.54 an ounce. Copper dropped 6 cents, or 2.4 percent, to $2.57 a pound.