By Anora Mahmudova and Barbara Kollmeyer, MarketWatch

NEW YORK (MarketWatch) -- U.S. stocks extended early gains after an anxious day of trading ahead of the closely-watched Federal Open Market Committee meeting.

In the end, the Federal Reserve stuck to its view that it will keep short-term interest rates near zero for a "considerable time" after the bank ends large-scale purchases of bonds meant to stimulate the U.S. economy. Fed Chairwoman Janet Yellen is holding a press conference at 2:30 pm Eastern.

The S&P 500 (SPX) rose 7 points, or 0.4 to 2.006.34, hovering near its all time closing high. The Dow Jones Industrial Average (DJI) added 45 points, or 0.3% to 17,176.41 and was above record closing high. The Nasdaq Composite (RIXF) gained 20 points, or 0.4%, to 4,573.12.

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Tanweer Akram, senior economist at Voya Investment Management, said that while the Fed's decision was in line with expectations, its subsequent decisions will still be contingent on data and the pace of recovery in the labor market.

"The fact that there is still slack in the labor market there is no inflationary pressure means the Fed will be cautious about withdrawing accommodation.

In economic news, U.S. consumer prices fell in August for the first time in 16 months, largely because of a decline in the cost of filling up at the gas station. Separately, the U.S. current account deficit fell to $98.5 billion in the second quarter from a revised $102.2 billion in the first quarter, the Commerce Department said Wednesday.

A gauge of confidence among home builders rose in September to the highest level since November 2005, according to National Association of Home Builders/Wells Fargo data released Wednesday.

Stocks to watch: Auxilium Pharmaceuticals Inc. (AUXL) soared 42%, after news late Tuesday that Endo International PLC (ENDP) will buy it for $28.10 per share in a cash-and-stock deal. Endo was up 5%.

Lennar Corp.(LEN) rose 4.8% after posting a 47% rise in third-quarter profit on Wednesday as higher prices and deliveries drove up revenue.

General Mills Inc. (GIS) fell 2% after posting a disappointing quarterly profit.

DuPont (DD) shares rose 3.8% after an investor urged a breakup of the company.

FedEx Corp. (FDX) rose 3.7% after posting better-than-expected profit and sales.

U.S. Steel Corp. (X) was up 10% after the company said it was making major strategic changes late Tuesday.

Adobe Systems Inc. (ADBE) fell 3%. The software maker posted quarterly results on Tuesday.

Rackspace Hosting Inc. (RAX) tumbled 15% after the cloud-computing company said it won't be selling itself. (Read more about the day's notable movers here http://www.marketwatch.com/story/adobe-rackspace-fedex-expected-to-be-in-spotlight-2014-09-17.).

Other markets: In Asia, Hong Kong stocks broke a five-session losing streak after a senior Chinese banking executive said the People's Bank of China is injecting 500 billion yuan ($81 billion) into the country's five big state-owned banks to help counter an economic slowdown. A string of recent weak data has heightened worries among investors.

The Stoxx Europe 600 index took inspiration from Wall Street and China stimulus, while the FTSE 100 managed small gains ahead of Thursday's vote on Scottish independence. Gold(GCZ4) was unable to hang onto positive territory. Barclays cut its forecast for the metal, citing risks skewed to the downside. Oil prices (CLZ4) were largely unchanged.

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