Stocks end higher after Fed keeps interest rates unchanged

Trader James Denaro, center, works with specialist Michael O'Connor, right, on the floor of the New York Stock Exchange on July 29, 2015.

AP Photo/Richard Drew

Last Updated Jul 29, 2015 4:42 PM EDT

NEW YORK - U.S. stocks are closing higher after the Federal Reserve said it would keep its benchmark rate unchanged.

The Dow Jones industrial average rose 121 points, or 0.7 percent, to 17,751 Wednesday.

The Standard & Poor's 500 index gained 15 points, or 0.7 percent, to 2,108. The Nasdaq composite climbed 22 points, or 0.4 percent, to 5,111.

Northrop Grumman led defense companies higher after it reported strong earnings and raised its outlook for the year.

Bond prices fell. The yield on the 10-year Treasury note rose to 2.29 percent.

The dollar rose against the euro and the yen.