US STOCKS-Market gains after Fed's decision, oil falls
(Updates to early afternoon)
* Fed keeps benchmark fed funds rate unchanged
* Beaten-down financial, tech shares lead rise
* Oil drop lifts sentiment
NEW YORK, June 25 (Reuters) - U.S. stocks rose on Wednesday, as the price of oil fell and the Federal Reserve held its key interest rate steady as expected.
It was the first time the Fed has held rates steady since embarking in September on a series of rate reductions to boost an economy grappling with a housing downturn and credit crisis.
The Fed also voiced greater concern about inflation and said downside risks to growth appeared to have diminished somewhat.
The price of oil fell after government inventory data showed a surprising increase in domestic crude supplies. That pushed the market higher as did a stronger-than-expected quarterly profit from Jabil Circuit (JBL.N), a contract electronics maker, whose stock shot up more than 13 percent.
With the market at three-month lows, investors looking for bargains in beaten-down sectors like financials and technology also helped lift stocks.
"To me, it seems like (the Fed is) trying to leave all doors open to itself. No hike was very much priced in and was widely expected," said Chip Hanlon, president of Delta Global Advisors, Inc in Huntington Beach, California.
The Dow Jones industrial average .DJI rose 54.71 points, or 0.46 percent, to 11,862.14. The Standard & Poor's 500 Index .SPX was up 13.41 points, or 1.02 percent, at 1,327.70. The Nasdaq Composite Index .IXIC was up 36.11 points, or 1.52 percent, at 2,404.39.
Shares of JPMorgan Chase & Co (JPM.N), the No. 3 U.S. bank, rose 1.5 percent to $38.29 and Bank of America Corp (BAC.N), the No. 2 bank, advanced 0.8 percent to $26.82. Citigroup Inc (C.N), the largest U.S. bank, gained 1.3 percent to $19.10.
Among tech stocks, iPod maker Apple Inc (AAPL.O) gained 2.1 percent to $176.82 on the Nasdaq.
Jabil Circuit climbed 13.7 percent to $16.31 on the New York Stock Exchange.
Another standout was AT&T Inc (T.N), the No. 1 U.S. telecommunications company, whose stock climbed 1.5 percent to $34.78 after a brokerage raised its rating on the stock.
U.S. crude CLc1 dropped $2.45, or 1.8 percent, to $134.55 per barrel. (Editing by Jan Paschal)
