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The stock market moved higher in volatile trading on Wednesday after the Federal Reserve raised interest rates by 0.25% and signaled six additional hikes later this year, as the central bank looks to ease concerns about surging inflation and the economic impact of the Russia-Ukraine crisis .


Stocks initially pared back gains following the Fed’s announcement—with the Dow Jones Industrial Average at one point giving up a 500-point gain—before rebounding.

The Dow rose 1.4%, nearly 500 points, on Wednesday, while the S&P 500 gained 2% and the tech-heavy Nasdaq Composite 3.5%.

The central bank raised interest rates, by a quarter percentage point, for the first time since 2018, while Fed officials also predicted six additional rate hikes in 2022 (up from a previous forecast of three increases this year).

Markets initially got a boost Wednesday morning from hopes of a possible ceasefire agreement in the Russia-Ukraine war, with Ukrainian President Volodymyr Zelensky saying in an address on Tuesday that a deal was beginning to “sound more realistic,” while Russian Foreign Minister Sergei Lavrov expressed “hope” for an agreement.

The heavy fighting in Ukraine has weighed on markets since last month, and while Ukrainian forces have held off attacks on several major cities, the country continues to call for more aid from the West, with Zelensky addressing the US Congress on Wednesday morning.

Oil prices, which have jumped in recent weeks due to the conflict between two major exporters, at one point surged to a multi-year high of $130 per barrel before moderating somewhat and now sitting at just below $100 per barrel.