By Amy Caren Daniel
(Reuters) - U.S. stocks rose on Thursday, helped by high-flying shares of Apple (NASDAQ:AAPL) and Amazon, as well as the Federal Reserve's confidence in the strength of the economy as it raised rates for the third time this year.
The Fed also left its monetary policy outlook for the coming years largely unchanged, but investors switched into sell-off mode shortly before the market close on Wednesday as they digested the implications of the end of an era of "accommodative" monetary policy.
Adding to the feel-good sentiment was data showing U.S. economic growth accelerated in the second quarter at its fastest pace in nearly four years as previously estimated.
"Fundamentally, earnings are rising, inflation appears non-problematic and interest rates are still relatively low and that presents a favorable backdrop for equities to trend higher," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis, Minnesota.
"FAANG's are strong today in part because they have pulled back recently which is presenting an attractive entry point."
Apple rose 2.2 percent and was the biggest boost to the three main indexes after JPMorgan (NYSE:JPM) started coverage of the stock with an "overweight" rating, citing the iPhone maker's quicker-than-expected move to a services business.
Amazon.com (NASDAQ:AMZN) rose 1.6 percent after brokerage Stifel talked up the company's retail, cloud, and advertising businesses. The online retailer is set to open a brick-and-mortar store in New York City.
The recently revamped communications services sector gained 1.09 percent, the most among the S&P sectors. It was lifted by gains in Netflix (NASDAQ:NFLX), Google-parent Alphabet (NASDAQ:GOOGL) and Facebook (NASDAQ:FB).
At 11:21 a.m. EDT the Dow Jones Industrial Average was up 116.18 points, or 0.44 percent, at 26,501.46, the S&P 500 was up 16.05 points, or 0.55 percent, at 2,922.02 and the Nasdaq Composite was up 66.92 points, or 0.84 percent, at 8,057.29.
The materials index , which fell 0.5 percent, was the only one among the 11 major S&P sectors to drop. The technology sector was the biggest boost to the S&P, with a 0.73 percent gain.
While Apple boosted tech, one of the drags was Accenture, which fell 1.2 percent as the consulting and outsourcing services company's full-year profit fell short of analysts' estimates.
Cruise operator Carnival (LON:CCL) Corp tumbled 5.5 percent after its fourth-quarter forecast missed estimates. Norwegian Cruise Line and Royal Caribbean slid 1.5 percent and 5.5 percent, respectively.
Joining them was Conagra, which dropped 6.8 percent after posting quarterly revenue that missed analysts' estimates.
That weighed on other food companies, with Kellogg, JM Smucker and Campbell Soup shedding about 2 percent.
Advancing issues outnumbered decliners by a 1.75-to-1 ratio on the NYSE and by a 1.31-to-1 ratio on the Nasdaq.
The S&P index recorded 15 new 52-week highs and nine new lows, while the Nasdaq recorded 42 new highs and 41 new lows.